“These types of threats are counterproductive and dangerous. They’ll only harden people’s views that China is purposely manipulating its currency to gain economic advantage. But they won’t stop the United States from taking steps to encourage China to float its currency as a mature economic power. The Chinese government’s leaders should clarify whether these comments are official government policy.”
August 8, 2007
His Excellency Zhou Wenzhong
Ambassador of the People’s Republic of China Embassy of the People’s Republic of China 2300 Connecticut Avenue, N.W.
Washington, D.C. 20008
Dear Mr. Ambassador,
According to an article in today’s edition of the Daily Telegraph, two Chinese government representatives have recently suggested that China may use its $1.3 trillion in currency reserves as a “bargaining chip” if the United States enacts new legislation to address undervalued foreign currencies. One of the individuals, an official at the Chinese Academy of Social Sciences, went so far as to suggest that China might be “forced” to take steps that would “lead to a mass depreciation of the dollar.”
These types of dangerous comments illustrate why the United States is right to be concerned about China’s currency practices. I would appreciate your confirmation that the comments do not reflect the official position of the Chinese government.
Sincerely,
Charles E. Grassley
Ranking Member