Tensions Mount Between U.S. And China Over Economic And Human Right Issues

According to a report by the Financial Times, tensions escalated between the U.S. and China on Friday over the yuan. The two countries had a heated exchange over economy and human right issues on Friday, raising tensions ahead of a possible showdown over China’s exchange rate policy next month.

A day after U.S. President Barack Obama urged China to adopt a “more market-oriented exchange rate,” the deputy governor of the Chinese central bank, Su Ning, responded by saying that U.S. should not politicize China’s exchange rate policy. The deputy governor said on Friday, “We always refuse to politicise the yuan exchange rate issue and we never think that one country should ask another for help in solving its own problems.”

President Obama’s comments on China’s exchange rate policy came on Thursday, ahead of a decision the U.S. Treasury department must make before April 15 on whether to label China as a “currency manipulator.” There has been mounting political pressure in the U.S. to act against China if it does not drop the peg to the dollar. Earlier, China had given signals that it was considering a shift in exchange rate policy when the governor of Chinese central bank said last weekend that the peg to U.S. dollar was a “special” policy adopted during the financial crisis and that it would be abandoned “sooner or later.”

Meanwhile, China also rejected criticism from the U.S. on its human rights record and published its own report about human rights issues in the U.S. The report came in response of U.S. state department’s annual assessment of human rights, which was released on Thursday and was critical of China’s restrictions on the internet and the way it treated dissidents in the country.