China hits back at US over Obama trade comments

CHINA hit back at the US yesterday after President Barack Obama vowed to get tougher with the Asian giant on trade and currency, stoking tensions already high over Taiwan and Tibet.

Obama hinted he would take Beijing to task over the strength of its yuan currency, responding to growing discontent in Congress over Chinese monetary policy as the US economy makes an uncertain recovery.

“Wrongful accusations and pressure will not help solve the issue,” foreign ministry spokesman Ma Zhaoxu told reporters when asked about the comments.

He also called for both countries to make efforts to develop their relations. “We should respect each other’s core interests and major concerns, so as to ensure the steady development of our relations.”

In a meeting with Democratic senators on Wednesday, Obama said he supported trade agreements but urged China to open its markets further to US goods saying what was needed was “putting constant pressure on China and other countries to open up their markets in reciprocal ways.”

“One of the challenges we have got to address internationally is currency rates, and how they match up to make sure that our goods are not artificially inflated in price and their goods are artificially deflated in price.”

Many policymakers accuse China of keeping its yuan artificially low, funding a flow of cheap exports around the world.

China’s response could increase tensions over a $6.4bn arms deal between the US and Taiwan, and Obama’s upcoming meeting with Tibet’s exiled spiritual leader the Dalai Lama.

China, which considers Taiwan part of its territory, has snapped off military ties with the US and threatened to blacklist companies involved in the arms sales.

The US does not diplomatically recognise Taiwan, where China’s nationalists fled in 1949, but has made a legal commitment to provide the island with arms for defensive purposes.

China said this week it was “resolutely opposed” to a meeting between Obama and the Dalai Lama, who will visit Washington from February 17. China accuses the Nobel Peace Prize winner of separatism. He says he is only seeking greater autonomy for his homeland.