China is continuing to devaluate its national currency to increase the competitiveness of its national exports causing some American experts to consider the move as “currency manipulation.”
China keeps its currency very low to enforce the interests of its export industries. This type of policy would make Chinese products even cheaper and, therefore, more attractive for buyers.
“Day after day they keep devaluing their currency throwing the world financial markets into an uproar. Is this currency manipulation?” Nicole Sandler from Sputnik’s radio BradCast asked US expert Dave Johnson.
According to Johnson, China indeed had been playing a massive game of manipulating its currency. The Chinese government tries to make the value of its currency stay very low to keep the manufacturing business afloat.
“When something’s cheap you go to China and get it there,” Johnson said.
He also added that China is pursuing this type of policy in order to “seize” businesses from other countries. It is not the game of growing people’s economy, “it is the game of stealing the business, the manufacturing,” for instance from the US.
According to previous reports, China is planning to establish the yuan as an alternative currency to the US dollar. In the future, its exports and imports are expected to be carried out in yuan.
Such a development clearly demonstrates that the US can no longer act independently in financial markets and should take into account the interests of other states.
“The world is not so US-centric anymore,” Sandler said.