China will not devalue renminbi to spur exports: central bank chief

US President Donald Trump has long accused Beijing of manipulating the renminbi to gain a trade advantage. (AFP)
Updated 10 March 2019

China will not devalue renminbi to spur exports: central bank chief

  • US President Donald Trump has long accused Beijing of manipulating its currency to gain a trade advantage
  • Washington has been seeking assurances on the exchange rate in the ongoing trade talks between the two nations

BEIJING: China has gone to great lengths to support its currency and would not devalue the renminbi to spur exports or combat trade frictions, the governor of the central bank said Sunday.
Speaking on the sidelines of China’s annual parliamentary session, Yi Gang said Washington and Beijing had discussed exchange rates in recent trade talks and reached a consensus on many “crucial” issues.
US President Donald Trump has long accused Beijing of manipulating its currency to gain a trade advantage and Washington has been seeking assurances on the exchange rate in the ongoing trade talks between the two nations.
“Let me stress here that we will never use the exchange rate for the purpose of competition, nor will we use the exchange rate to increase China’s exports or as a tool in handling trade frictions,” said Yi.
“We have committed not to do this,” Yi told reporters.
He noted the US Treasury Department had declined many times to label China a currency manipulator in its semi-annual report on international exchange rates.
Beijing and Washington have been locked in a bruising trade war since last year, imposing tit-for-tat tariffs on more than $360 billion in two-way trade, which has left global markets reeling.
“The two sides reached consensus on many crucial and important issues,” Yi said, without specifying which issues.
China’s banking regulator told reporters earlier this week that the two sides would reach a consensus on the exchange rate and indicated it would not be a sticking point in the way of a larger trade agreement.
“China’s efforts and achievements in maintaining the basic stability of the renminbi exchange rate at a reasonable and balanced level are recognized by the whole world,” Yi said.
In the past three or four years the exchange rate had been under market pressure to depreciate, Yi said, adding that Beijing had used up $1 trillion of China’s foreign currency reserves to stabilize the currency.
There have been conflicting comments from Washington and Beijing on the progress of negotiations.
Beijing is hopeful about its next round of trade talks with the US, China’s vice minister for commerce Wang Shouwen said Saturday, after revealing that top negotiators had tried to hammer out a deal over a lunch of burgers and eggplant chicken in a recent round of talks.
Donald Trump on Friday said he remains optimistic but will not sign a pact unless it is a “very good deal,” and a top economic adviser said the US president could walk away from a bad deal.
The two sides were thought to be readying for a Trump-Xi meeting at the end of March, but the US ambassador to China said Friday that the two countries were not yet ready to bring together the two leaders for a summit and deal signing.


Lufthansa to freeze hiring, cut costs over coronavirus

Updated 26 February 2020

Lufthansa to freeze hiring, cut costs over coronavirus

  • ‘All new hires ... will be reassessed, suspended or deferred’
  • Lufthansa has also slashed connections with Hong Kong in the face of reduced demand

FRANKFURT AM MAIN: German airline Lufthansa said Wednesday it would freeze new hires and use unpaid leave and additional short-time work to cut costs to help cushion the economic impact of the novel coronavirus.
“To counteract the economic impact of the coronavirus of the early stage,” the group, which also owns carriers Austrian and Swiss, said in a statement that “all new hires ... will be reassessed, suspended or deferred.”
Employees would be offered unpaid leave and more part-time work and the group would also seek to cut administrative costs, it said.
“It is not yet possible to estimate the expected impact ... on earnings,” the group said, adding that it would provide more details at its annual results press conference on March 19.
The Frankfurt-based group said 13 of its aircraft were grounded, after it canceled all flights to and from mainland China by its flagship airline, as well as Austrian and Swiss until March 28.
Lufthansa has also slashed connections with Hong Kong in the face of reduced demand “and additional frequency adjustments to and from Frankfurt, Munich and Zurich are planned,” it said.