Would a Large Renminbi Revaluation Make the World Economy Healthier? A Debate on China’s Currency and its Global Effects

The value of China’s currency has jumped to the top of the U.S.–China agenda. Although the U.S. Treasury has deferred its April 15, 2010 report on whether China is a “currency manipulator,” legislation has been proposed that would impose tariffs on Chinese exports to the United States if the currency is not sufficiently revalued. The issue has garnered front page headlines and triggered heated exchanges between those on both sides of the debate. Experts disagree about the effect of a revaluation on Sino-American trade, the creation of jobs and inflation in the United States, the global economic recovery, and worldwide imbalances.

The National Committee's 2010 Members' program featured two leading experts who helped shed light on this debate, placing the issue in the global context. Their topic: Would a large renminbi revaluation make the world economy healthier? Stephen Roach, chairman of Morgan Stanley Asia, has urged caution in dealing with China on its currency, publicly sparring with economists and lawmakers who advocate a speedy and steep revaluation and doubting that “a revaluation will cure global imbalances.” Martin Wolf, chief economics commentator for the Financial Times, has written that China is a currency manipulator, that undervaluation creates imbalances and that imbalances hinder global recovery.

Economic Cooldown: Trends in Chinese Leadership Policy

The decline in China’s rate of economic growth coincides with several significant anniversaries: the 20th anniversary of the 1989 Tiananmen demonstrations, the 30th anniversary of China’s economic reforms, the 50th anniversary of the Dalai Lama’s flight from Tibet, the 60th anniversary of the founding of the People’s Republic of China, and the 90th anniversary of the 1919 May Fourth movement. In this context, China’s policymakers have taken steps to redress slowing economic growth, assuage social unrest, minimize political agitation, and sustain leadership unity.

At the National Committee’s 2009 Annual Members Program, four leading specialists and contributors to the China Leadership Monitor explained these trends within China from the perspective of leadership politics, society and economics. These experts — Joseph Fewsmith, Professor, Department of International Relations, Boston University; Cheng Li, Senior Fellow, The Brookings Institute; Alice Miller, General Editor, China Leadership Monitor, Hoover Institution; and Barry Naughton, Professor, Graduate School of International Relations and Pacific Studies, University of California, San Diego — discussed the impact of the global economic downturn on China’s leadership and examined the relationship among the U.S., Chinese and global economies and its implications for the broader Sino-American relationship. National Committee President Stephen Orlins moderated.

The American and Chinese Economies: Integration and Implications

Monday, May 19, 2008 - Recent disruptions in the U.S. economy effectively illustrate some of the ways in which the American and Chinese economies have become inextricably intertwined – and the challenges and opportunities this relationship presents to the two countries’ governments. Problems in the U.S financial sector and broader economy raise new issues for China’s economic planners and private businessmen and women. At the same time, the price of U.S. financial and other assets presents new investment opportunities for China Investment Corporation, the country’s sovereign wealth fund, and other Chinese corporations. Further complication is added because this is a U.S. election year, during which trade, employment and economic nationalism play a greater role in the political discourse.

At our 2008 Annual Members Program, three leading specialists – Nicholas Lardy, David Malpass and Henny Sender – helped us understand these issues. Moderated by National Committee president Stephen Orlins, the panel examined the relationship among the U.S., Chinese and global economies and its implications for the broader Sino-American relationship.

The Annual Members Business Meeting (open to Members only) preceded this panel program.

Click below to listen to the 2008 Annual Members Program.
MP3 Audio File

Through Experienced Eyes: A Discussion on Current Issues in U.S.-China Relations

The 2007 National Committee’s Annual Members Program, Through Experienced Eyes: A Discussion on Current Issues in U.S.-China Relations, surveyed current issues in U.S.-China relations from the perspective of four former Assistant Secretaries of State for East Asian and Pacific Affairs: William Clark, Richard Holbrooke, Stanley Roth and Richard Solomon. The discussion focused on where American and Chinese interests converge and diverge, the challenges of formulating and implementing China policy in the politically charged Washington environment, and how relations with China fit into the broader framework of American policy toward Asia.