China blasts 'protectionism' bill of US

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BEIJING, July 30 (AFP): China's state-run press said Monday a new United States (US) currency bill smacked of protectionism as Treasury Secretary Henry Paulson, visiting the Asian giant for economic talks, called for a stronger yuan.
The English-language China Daily used its main editorial to criticise the bill which could open the door to US sanctions against Beijing for not allowing the yuan to rise quickly enough.
"The legislation that smacks of strong protectionism risks undermining ongoing bilateral efforts to reduce trade imbalances
between the two countries", the China Daily said.
"Unfortunately, the new US bill tends to mislead its people into believing that protectionism can be an answer to its economic woes."
Last week, the Senate Finance Committee overwhelmingly approved the bill that requires the Treasury to identify nations with "fundamentally misaligned" currencies, potentially opening the door to economic sanctions against Beijing.
The China Daily argued efforts were instead needed to persuade American consumers to consume less and save more to narrow its current account deficit.
"(China) is resolved to introduce greater flexibility into its foreign exchange regime at its own pace and reduce its external imbalances," it said, pointing out recent measures such as a cut in export tax rebates.
Paulson arrived in China Sunday and will spend Monday inspecting environmental projects in the nation's northwest before heading to the capital for talks with President Hu Jintao and Vice Premier Wu Yi.
"The rate of appreciation has gone up considerably over the last year and the renminbi (yuan) has now appreciated well over nine per cent," Paulson told reporters en route to China.
Still, he said he would like to see "more, and much more."
Paulson's visit comes amid growing pressure to curb the burgeoning US trade deficit with China and moves in the US Congress to punish Beijing for what some say are unfair trade policies.
US lawmakers say the undervalued yuan makes US-bound exports cheaper, thereby fuelling the trade deficit with China, which hit 232.5 billion dollars last year according to US figures.