China: G-20 must focus on economy, not currencies

SEOUL: The upcoming G-20 summit of major economies should focus on the global recovery rather than individual currencies, a Chinese diplomat said Wednesday, as Beijing tries to defuse pressure to ease its exchange rate controls.

Currencies are in sharp focus as investors seeking a haven of high-growth amid miserably low returns in the developed world pour cash into Asian stocks and bonds, pushing many of the region's currencies to export-bruising levels. Thailand on Tuesday imposed a tax on foreign investment in bonds, joining other nations in seeking to stem currency appreciation.

But China's currency, the yuan, is tightly controlled and has risen much less against the dollar than the currencies of other Asian nations. The U.S. and Europe, meanwhile, complain that the yuan is kept artificially low, giving China's exporters an unfair advantage and costing jobs.

``The G-20 should focus on what is required by the global economic recovery ... certainly not on any particular currency of any particular country,'' Chinese Vice Foreign Minister Cui Tiankai told reporters.

``If you do want to discuss currency issues then you have to focus on the major international reserve currencies first,'' Cui said on the sidelines of a G-20-related forum, referring to the dollar, euro and yen. Cui is a key Chinese official for G-20 affairs.

China has been under pressure for years to allow the yuan to strengthen substantially in line with its emergence as a top global economy. Beijing denies that it manipulates the yuan and says it is allowing it to gradually strengthen in a way that will not harm the world economy.