China, Japan to start trading of currencies

Fazle Rashid NEW YORK, Dec 27: China and Japan -- two mightiest economies in the world -- have agreed to commence trading of the currencies. The agreement was clinched during Japan's prime minister Yoshihiko Noda's visit to Beijing. President Hu Jintao and Japan's prime minister held wide ranging talks and underscored the urgency of maintaining peace in the Korean peninsula a move that would be greeted in Washington as well. China-Japan currency deal will lessen the burden on the US dollar. China is a making a sustained drive to woo countries to unlock ties with the dollar and join renminbi to broaden global use of the Chinese currency instead of the US dollar. China and Japan together hold the world's largest foreign currency reserves, China $3.2 trillion and Japan $1.3, the New York Times in a report said today. Renminbi is still not fully convertible so China will not compete to transform it as the global reserve currency dislodging the US dollar. Renminbi will play more important role in Asia. Meanwhile, the renewed US drive to locate overseas assets of the American tax cheats has created a panic. American Corporate giants with business outside the country fear they will have to spend billions of dollars a year. The new legislation will ensure that Americans cannot use hidden trusts overseas to evade taxes. The US treasury will get more than $8.0 billion of unpaid taxes for past ten years. And in the world of politics, Pakistan's prime minister Yusuf Raza Gilani poured cold water on global speculation that he was going to dismiss army chief Gen Ashfaq Parvez Kayani and the ISI director Lt Gen Pasha. This was a backtrack. Gilani only two days before has warned the conspirators against the civilian government and accused the generals of acting as state within the state and reminded them they are accountable to the parliament. The army chief debunked the speculation of an army takeover and reiterated total support for the political democratic government.