Since the sub-prime crisis and the outbreak of the global economic recession, in order to curb the decline in exports too fast, to prevent the export enterprises have closed down a large area, China was forced to once again firmly linked to the renminbi exchange rate with the U.S. dollar to maintain the stability of the currency. Obviously, this should be seen as a last resort in a crisis in China expedient measure and do not represent the true future of the RMB exchange rate trend. As the Chinese Government has repeatedly stressed, "China will continue to follow the initiative, controllability and gradual nature of the principle of the RMB exchange rate flexibility to enhance and maintain the RMB exchange rate at a reasonable and balanced level, a basic stability."
During the crisis, from the lessons of history and the "same boat" the practical needs of an overwhelming impulse of mutual accusations. Thus, in the past year, the G20 cooperation under the framework of European and American countries are also being maintained on this topic a rare restraint.
However, with the advent of the global economic recovery phase, one of the world is no longer monolithic. Last weekend, the euro zone and EU "Troika" to China on a collective appreciation of the renminbi and other issues to put pressure on China. The so-called "troika", referring to the Eurogroup Chairman Juncker, European Central Bank president Jean-Claude Trichet and European Commission Economic and Monetary Affairs Joaquin Almunia.
Of course, not just only the Europeans, so look forward to a stronger yuan. In fact, some people in the United States has been to heart, such as the U.S. Democratic Senator Chuck Schumer and Republican Senator Lindsey Graham, a recent survey once again urged the U.S. Department of Commerce called the renminbi exchange rate "manipulation." It is noteworthy that the U.S. government will have to much more rational. Recently, Obama's first trip to China would deliberately avoided the sensitive topic of the RMB exchange rate; Not only that, last month, the U.S. Treasury Department again rejected the Chinese currency manipulation to include the list.
The logic behind this phenomenon is actually quite simple. That is, as the world's only superpower, the United States in more global and regional political, security and economic matters, need to rely on China's vigorous coordination. At the same time, for the United States, the yuan against the dollar maintained a stable exchange rate, rather than deliberate devaluation. During the election period set aside purely political considerations aside, the U.S. elite, there are a lot of people are actually well aware that even if the yuan and the dollar decoupling, as long as the American people with low savings, high consumption habits do not appear fundamentally change, the U.S. trade deficit can not be significantly reduced. Thus, for the United States, at the crucial moment to reposition itself in the slogan of yuan appreciation, in addition to meet the requirements of some domestic interest groups, the more important as the bilateral political and economic game when a tool.
The idea of Europe will have to complex. Compared with the United States Banzhebanyan, objectively speaking, Europe's internal and external pressure is much greater. Standing position in Europe, this time repeat yuan appreciation, seem to completely fit the meaning of realism.
On the one hand, since March this year, due to depreciation of U.S. dollar - yuan pegged to the dollar because it was wholly with the U.S. dollar almost at the same depreciation of the euro, sterling and other non-dollar currencies to appreciate significantly. Among them, the euro has appreciated against the dollar, more than 20%, although the first half of the appreciation of sterling is also very powerful, but in August began after the devaluation. In other words, the appreciation of the euro was forced to bear the major pressure alone. In this case, the euro zone have to find another large economies to share the burden of such pressure. The economic recovery is the fastest-growing China is undoubtedly the best choice. Juncker's words to use is that if the yuan does not appreciate, they are "difficult to convince people in the euro area, why is the world's fastest growing economies of the countries are still in the depreciation of their currencies."
On the other hand, perhaps even more serious, the euro area is facing a fierce internal conflict of interest and balance. If you do not timely transfer of such pressure, the entire euro area would probably collapse. This is not alarmist. • Harvard economics professor Martin Feldstein that the predictions, including Spain, Greece, Ireland, Portugal, Italy and some other euro area countries, the current may have no shortage of "From the single currency system, just leave," the impulse.
The root causes of conflicts must be traced back to the beginning of the creation of the euro. For the euro area member states, the advent of the single currency simplifies transaction costs, greatly promoted the intra-regional trade integration, but behind a currency, and yet the two hidden danger lurking, which may not be apparent economic prosperity phase However, the crisis to be exposed.
The first vulnerability is the issue of the independence of monetary policy. When the European Central Bank instead of monetary policy by central banks, which means loss of national monetary autonomy to decide when to shrink, when the right to monetary easing. Due to historical reasons, Germany, the ECB's monetary policy-making have greater influence on the European Central Bank has inherited the priority of the German central bank to control inflation steady style, resulting in the anti-crisis process, the European Central Bank is not as daring as the Fed and the Bank of England implementation of bold quantitative monetary easing. This makes Spain, Italy and other economic resilience more vulnerable countries have deeply suffered. Take Germany and Spain, the economic situation between the two countries to make a more telling comparison: At present, the German unemployment rate is about 8%, while Spain's unemployment rate is as high as 19%. When the second quarter, Germany and France within the first recovery in the euro area, other members of the euro zone's economic recovery has lagged far behind, still negative growth trend.
The second vulnerability is a unified exchange rate different from the benefits of distributional effects. In theory, the euro exchange rate should be 16 members of the real exchange rate level of the currency a compromise, it must be a comprehensive reflection of all members of the labor productivity, the trade surplus and other competitive conditions. In this way, the original of the strongest currencies of the countries (eg Germany) will become the biggest beneficiary - assuming Spain and Germany also respectively pesetas and deutsche mark as the currency, then the difference in the trade balance will lead to the appreciation of marks peseta devaluation. Feldstein that it was precisely because of the euro, the German mark could have been avoided sharp appreciation of the unfavorable situation, which continues to expand its trade surplus; while the original members of the currency relatively weak strength in the case of the real exchange rate had to suffered a larger trade deficit.
Statistical data to support this hypothesis: from August 2008 to August 2009, Germany achieved a record trade surplus of 175 billion U.S. dollars, the powerful driving force of its rapid economic recovery; Spain appeared in the same period 840 billion U.S. dollars trade deficit.
It should be recognized in the euro zone leaders, there is some real anxiety reasons; from a long-term perspective, this may also allow the United Kingdom, Sweden and other Western European economic power in the total risk of "Euro-phobia", and thus the long-term alienation from the euro outside the area. However, this internal imbalance in the euro area should be carried out through its internal policy adjustments shift the Chinese was not appropriate.
We want to see is that the current global economic downturn has not completely dissipated the haze. The outbreak of Dubai's debt crisis had already exposed tip of the iceberg. Once the short-term interests between China and Europe due to trade protection induced by a large-scale war, the confidence of the global economic recovery will be a devastating blow. This is neither in line with China's long-term interests, nor in line with Europe's long-term interests. So whether it is trade between the EU and Sino-US differences is best to enhance communication through dialogue in order to obtain mutual understanding, rather than taking recourse to sanctions and threats to try to achieve their goals.
(First Financial Daily) (E05)
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