Don961: America is considering charging countries that devalue their currencies
Friday 24 May 2019
The United States Department of Commerce said it is proposing a new customs duty to combat subsidies on products of countries that devalue their currencies against the dollar in another move that could lead to higher tariffs on Chinese products.
The new law could introduce goods from other countries to raise tariffs, including Japan, South Korea, India, Germany and Switzerland.
All of these countries, along with China, are on the “watch list” of the semi-annual Treasury Department report, which monitors currency market interventions, global large current account surpluses and high bilateral trade surpluses.
The ministry said its proposed law would amend the normal process of charging counter-customs duties to include a new currency devaluation standard. Trump officials say the Chinese yuan has been depreciating against the dollar for a long time, despite the US-China trade war, which foreign exchange experts say has damaged the value of the yuan.
“This change warns foreign exporters that the Commerce Department can counter currency support that is damaging to US industries,” Trade Minister Wilbur Ross said in a statement.
“Foreign countries will no longer be able to use currency policies to harm American workers and companies,” he said.
Ross stressed that it was a step towards fulfilling the promise made by US President Donald Trump during his campaign to address unfair currency practices.
The ministry did not specify the specific standard it would use to assess whether US pricing of products was artificially low due to devaluation. link