US may try new tactic to fight ‘currency manipulation’ by China

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Washington:┬áThe Trump administration is exploring a new tactic to discourage China from undervaluing its currency that falls short of a direct confrontation, a media report said, signaling softening of America’s stance against China on the issue.

Under the plan, the commerce secretary would designate the practice of currency manipulation as an unfair subsidy when employed by any country, instead of singling out China, The Wall Street Journal said, citing people involved in formulating the policy.

Once such a decision is taken by the US Government, companies would then be in a position to bring anti-subsidy actions themselves to the Commerce Department against China or other countries, the financial daily said.

The currency plans are part of a China strategy being assembled by the White House’s new National Trade Council, which seeks to balance the goals of challenging China while still keeping relations with the country on an even keel, the daily said.

“To do that, measures taken against China would also apply to other nations,” it said.

The latest reported move is seen as a climb down from the previous stance of the President Donald Trump, who during his election campaign had said that he would designate China a currency manipulator on the first day of his presidency.

He had also promised to slap a tax of as high as 45 per cent on import of Chinese products, of China does not fix its currency valuation.

The daily warned that the countries might drag US to World Trade Organisation on its currency move or the US could face similar retaliatory measure from other countries as well.

The White House did not comment on the story.

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