China rules out competitive currency devaluations

An office building is reflected on a new 100 Yuan note on display outside a bank in Beijing, in this Jan. 11, 2016 file photo. (AP)
Updated 07 May 2017

China rules out competitive currency devaluations

BEIJING: China has no intention and no need to carry out competitive currency devaluations, the head of the country’s foreign exchange regulator said.
In a weekend piece in the Chinese magazine Modern Bankers, Pan Gongsheng said the People’s Bank of China’s (PBoC) supplying of liquidity to the market was to prevent excessive fluctuations in the exchange rate and prevent a “herd effect,” to maintain market stability.
“China has no intention of raising competitiveness via currency devaluation. It does not have this wish, and it also does not have this need,” Pan, who runs China’s State Administration of Foreign Exchange (SAFE), wrote.
China was working hard to raise the exchange rate’s flexibility and to maintain its stability, he added.
This was good for the international community and would avoid negative spillover effects from a disorderly exchange rate adjustment or competitive devaluations by other currencies, Pan wrote.
Pan is also a vice governor of the PBoC.
China’s yuan is up just around 0.6 percent so far this year, having lost nearly 7 percent in 2016. In November, the yuan hit an eight-year low following Donald Trump’s shock election as US president.
In a Reuters poll last week, the yuan was forecast to weaken to 7.07 per dollar in a year.
Despite harsh rhetoric about China on the campaign trail, Trump has recently had warm words for his Chinese counterpart Xi Jinping, praising him for trying to rein in nuclear-armed North Korea.
Trump has also backtracked on his pledges as a candidate to label China a “currency manipulator” and impose steep tariffs on Chinese imports.
Speaking at a forum on Sunday organized by Hong Kong-based Phoenix Television, Chinese Vice Finance Minister Zhu Guangyao said that trade disputes between China and the US should be resolved via “cooperative methods.”
China and the US need to strengthen fiscal and monetary policy coordination, he added, according to a report on the broadcaster’s website.
China will also pay close attention to Trump’s tax cut plan, Zhu said, without elaborating.
Last month, Trump unveiled a one-page plan proposing deep US tax cuts that would make the federal deficit balloon if enacted.


Abu Dhabi carrier Etihad launches more fuel-efficient Boeing 787 Dreamliner

Updated 51 min 32 sec ago

Abu Dhabi carrier Etihad launches more fuel-efficient Boeing 787 Dreamliner

  • Etihad’s CEO Tony Douglas described the aircraft as a flying laboratory for testing that could benefit the entire industry
  • This year, Etihad flew the world’s first passenger flight using sustainable biofuel made from a plant that grows in saltwater

DUBAI: Abu Dhabi’s flagship carrier Etihad Airways announced on Monday it is launching one of the world’s most fuel-efficient long-haul airplanes as the company seeks to save costs on fuel and position itself as a more environmentally-conscious choice for travelers.
Etihad’s “Greenliner” is a Boeing 787 Dreamliner that will depart on its first route from Abu Dhabi to Brussels in January 2020. Etihad’s CEO Tony Douglas described the aircraft as a flying laboratory for testing that could benefit the entire industry.
With fuel costs eating up around a quarter of airline spending, Douglas said the goal of the Greenliner is to be 20 percent more fuel efficient than other aircraft in Etihad’s fleet.
“This is not just a box-ticking exercise,” he told reporters at the unveiling of the initiative at the Dubai Airshow alongside executives from Boeing.
Douglas said the aircraft “not only makes sense economically from a profit and loss account point of view, but because it also directly impacts the CO2 because of the fuel burn.”
Etihad has reported losses of $4.75 billion since 2016 as its strategy of aggressively buying stakes in airlines from Europe to Australia exposed the company to major risks.
Despite its financials, the airline continues to be among the most innovative.
This year, Etihad flew the world’s first passenger flight using sustainable biofuel made from a plant that grows in saltwater. It also became the first in the Middle East to operate a flight without any single-use plastics on board to raise awareness of the effects of plastic pollution.
Aviation accounts for a small but rapidly growing share of greenhouse-gas emissions — about 2.5 percent worldwide. But forecasters expect air travel to grow rapidly in the coming years.
Etihad says it plans to make the Greenliner a “social media star” to bring under sharper focus its developments and achievements worldwide. Douglas said anything that Eithad learns with Boeing from this aircraft’s operations will be open domain knowledge “because it’s about moving the industry forward in a responsible fashion.”
“We’re like a millennial and like all good millennials, they’re really focused on the environment and the sustainability agenda,” Douglas said, referring to Etihad’s 16 years in operation.
The Greenliner will be the only aircraft of its kind in Etihad’s fleet of Dreamliners. The company currently has 36 of the 787s in its fleet with plans to operate 50.
“This is a small step today, but in a very, very long journey,” Douglas said.