China Denies Seeking Trade Surplus

Oct. 4, 2010
Says U.S. is 'politicizing the problems in China-U.S. relations.'

Chinese Premier Wen Jiabao accused U.S. lawmakers of politicizing currency levels, saying that a trade surplus was natural at his country's stage of development, in an interview with CNN that aired Oct. 3.

"China does not pursue a trade surplus," Wen told CNN's Fareed Zakaria in a rare interview with foreign media.

"Some people in the United States, in particular some in the U.S. Congress, do not know fully about China. They are politicizing the problems in China-U.S. relations -- in particular the trade imbalance between our two countries," he said
U.S. lawmakers, led by members of President Barack Obama's Democratic Party, have accused China of deliberately keeping its currency low to boost exports, contributing to the steady losses of manufacturing jobs in the United States.

With elections approaching, the U.S. House of Representatives last week voted to broaden the powers of the Commerce Department to allow it to impose tariffs on products due to currency manipulation.

But Wen countered that China has been reforming its currency, the yuan, since 1994 and that the United States ran trade surpluses after the onset of the industrial age.

"This is actually what would happen for a country in a certain stage of development," Wen said.

Wen gave an upbeat assessment of the U.S. economy despite its recent woes, crediting the world's largest economy with the "strength of scientific and technological talent, and managerial expertise."

"In spite of the twists and turns, the United States, I believe, will tide over the crisis and difficulties, and we must have confidence in the prospects of the U.S. economy," Wen said.

He also endorsed one recommendation from the United States -- that China shift its economy from one based on exports of manufacturing goods to one centered on the demand of its fast-growing consumer class.

"China has a vast domestic market. And there is a great potential in China's domestic demand," Wen said.

Copyright Agence France-Presse, 2010

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