For the recent remarks for the RMB appreciation in the international community, the commerce minister Chen Deming stated with a resolute attitude at the press conference for the third session of the 11th National People’s Congress on March 6 that we shall not simply connect foreign trade and exchange rate, and what currently badly needs to be solved is the international trade equity.

He said Chinese economy has suffered severe impact and damage since the outbreak of the financial crisis. Last year the export of foreign trade declined by 16% while this year sees a growth of recovery in foreign trade. But in terms of the uncertainties of the global economic pattern, such growth is fragile, so it is too early to say the growth of Chinese foreign trade. From January to February, Chinese trade surplus witnessed a year-on-year decline of 50.2%.

Meanwhile, the US sets up rigid and separate export control against China and there is no bilateral balance of trade, so “how to discuss the relationship of exchange rate and trade in the situation where there is no fairness, freedom and facility of trade?”

Chen said that exchange rate is the economic policy of the countries across the globe for macro-control while subsidy is the one for specific commodities and rigidly defined by the World Trade Organization, so they are not the concepts in the same law. Under the circumstances of fully open free trade, there exist a certain relationship between trade and exchange rate, but if bilateral trade meets with illiberality and inequality, it is of no significance to discuss trade surplus and deficit.

Source：Xinhua