White House invites China for G-7 talks (AP) Updated: 2005-09-20 06:57
American manufacturers contend the yuan is undervalued by as much as 40
percent against the dollar. That means Chinese goods are much cheaper for
American consumers and American products are much more expensive when sold in
China.
Sens. Charles Schumer, D-N.Y., and Lindsey Graham, R-S.C., are sponsoring
legislation that would impose 27.5 percent across-the-board tariffs on all
Chinese products coming into the United States in an effort to pressure the
Chinese to revalue their currency further. They have the legislation on hold now
but have vowed to resume pushing for a vote if China does not make further
progress.
America's trade deficit with China hit a record of $162 billion last year,
the biggest imbalance ever recorded with a single country. And this year's gap
is running 30 percent above the 2004 pace, reflecting a surge in imports of
Chinese clothing and fabric after the removal of global quotas at the beginning
of the year.
The meeting Friday would mark the third time the Chinese have participated in
the discussions with the Group of Seven nations — the United States, Britain,
Canada, France, Germany, Italy and Japan.
The first time China participated in a G-7 finance meeting was in the fall of
2004, at Snow's invitation. They also participated in a February G-7 meeting in
London but skipped the April session, reportedly because they did not want to
face more pressure regarding their currency.
The G-7 discussions will be a prelude to the annual meetings over the weekend
of the International Monetary Fund and the World Bank. In addition to the G-7
talks, Snow was scheduled to hold daylong discussions at Treasury on Thursday
with top finance officials of Iraq, seeking to assess the progress the country
is making in rebuilding its economy.
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