For Brazil Lack of Growth and China’s Currency Are Distortions in World Market

Yuan, China's currencyFor Brazil’s central bank chief Henrique Meirelles, a stronger Chinese currency is “critical” for the good of the global economy. And he said that on Tuesday, April 20, joining a chorus of critics of China’s foreign exchange policy.

Speculation that China may soon revalue its currency and unveil a long-awaited shift in its exchange rate has intensified in recent weeks, and the Yuan is likely to figure in discussions at this week’s Group of 20 meeting of finance officials in Washington.

“I think it’s absolutely critical for the equilibrium of the world economy,” Meirelles said when asked by a Senator what the impact would be if China re-valued its currency.

Meirelles was speaking to the Senate’s Economic Affairs committee before traveling to Washington where the spring meetings of the International Monetary Fund and the World Bank will also be held.

“There are some distortions in world markets, one of them is a lack of growth and another is China” Meirelles said.

“China’s exchange rate is the result of the country’s big savings … this generates distortions for China itself.”

China has been under pressure from the United States and other countries to let the Yuan strengthen so that global products become more competitive vis-à-vis Chinese exports.

This month, Brazil’s Finance Minister Guido Mantega joined the debate when he said that a flexible currency policy in China “would be very good” for the global economy.

Last week, Brazilian President Lula da Silva met with his Chinese counterpart Hu Jintao in Brasilia at a summit of the so-called BRIC group of major emerging markets, which also includes Russia and India. But Lula da Silva did not mention the Yuan.

So far Hu Jintao has reiterated Beijing’s long-standing official description of its Yuan policy, saying that China remains on course to gradually put in place a managed floating exchange rate system.

Mercopress

Tags:

Ads

You May Also Like

LETTERS

A poll by Berlin-based Transparency International with international businessmen from around the world has ...

Brazil Makes US$ 10 Bi Exporting Oil and Spends US$ 11 Bi Importing It

Brazilian exports of oil and derivatives yielded US$ 10.136 billion between January and September ...

Brazil’s Pantanal Wetlands Doomed to Disappear in a Few Decades

The growth of farming and cattle ranching in western Brazil could destroy the world’s ...

Brazil’s G20, the Poorest and the Rich Won’t Reach Accord Without New Language

The Hong Kong meeting of the WTO has amply illustrated how difficult it is ...

Elections: Brazil Debates Abortion While Letting Kids Die After They Are Born

It is not surprising that the issue of abortion, sexuality, and Christian faith is ...

Analysts See Lower Brazilian GDP

The decline in business investments, in Brazil, in consequence of high market interest rates, ...

Brazil’s Lula Chastises the US and EU for not Doing Enough for Poorer Countries

Brazilian president, Luiz Inácio Lula da Silva, ahead of this week's G8 meeting in ...

Paraguay: Where Brazil Buys Cheap Dreams

There were tales of the wonders that could be gotten in Paraguay: strange mechanical ...

Brazil: High-Class Crime Uses Charm as Master Key

Everyone knew that Brazil’s Banco Santos was about to go broke, including the media. ...

Brazil’s Plan to Reduce Breast and Uterus Cancer by 30%

A 30% reduction in eight years in deaths caused by breast cancer and a ...