The article "China’s Bank Chief Says Currency Is Unlikely to Rise (2010, March 6) in The New York Time catch my interest because any policy issuing by the new fast-growing country like China will affect the rest of the world.
The article states that China is warned by US to change the policy of currency from fix to dollar to managed float. US gives the reason that China's currency increase ability of competitiveneess to China with using cost of other countries. However, Chinan has no plan to change the country's currency.
Eventhough in the global recession, China is still has high economic growth. In my opinion, there are two main factors that make China advantages, the first is the growth of inner market. China has high population that can absorb the products that produce domestic and import. The last is the center government policy that control by government make the country have high competitiveness. For example, China's government buy a large amount of US bond for her saving that make China to be an important debtor of US. Therefore, to tell China to change her government policy is not easy because now China has many advantages of negotiation.
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References
Wines M.,China’s Bank Chief Says Currency Is Unlikely to Rise (2010,March 6).The New York Time retrived by Mach7, 2010 from http://www.nytimes.com/2010/03/07/world/asia/07china.html?ref=business
Mod,
ReplyDeleteDo you think that there might be domestic costs in the longer term to China's current policy of refusing to allow the Yuan to float and be freely traded on the international foreign exchange market?
In my opinion, I think China will not cahnge its currency regime. As long as China exploit a benifit on it cheap money to boost its export sector.
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