Revaluating yuan won't help, expert says

[lovuian]

http://feeds.bignewsnetwork.com/?sid=12e43455e0d139fd

China's competitive labor costs ensure a sustained trade surplus and growing foreign exchange reserves for the next 20 years, a state statistics official said.

'A further appreciation of the yuan cannot resolve these issues,' National Bureau of Statistics spokesman Zheng Jingping said.

'The trade problems (between China and the United States) cannot be solved simply by letting the exchange rate rise or fall, and this has been proven by the trade relations between the U.S. and Japan,' Zheng said, pointing out that Japan continued to enjoy a trade surplus with the United States despite the sharp appreciation of the yen over the past three decades, the South China Morning Post reported Friday.

After announcing that China's economy grew 10.2 percent for the first quarter, Zheng described the accelerated growth rate as still normal.

'The reason for China's increasing trade surplus and foreign reserves,' Zheng said, 'was that China's external trade was dominated by the processing trade and many multinationals moved their production bases to China to capitalize on low labor costs.'
more...

Competitive labor force you mean slave labor force...

I disagree China can't keep this up for 20 years Americans won't let it happen... your seeing the stirrings already...

[unblock]

1. competitive labor costs wouldn't be as competitive if the yuan cost more

duuuhhhhhhh.

[gizmo1979]

2. Even with large differences in pay

The average company only saves 16 to 24 % through outsourcing the devaluation of yuan is worth 27%.You do the math.Just another so called expert with an in with the chinese.

[oblivious]

3. One benefit of $200/barrel oil I guess. Local mfg may come back in style.

...as ocean transport becomes unmanageably expensive.

[Porcupine]

4. Ocean transport is incredibly cheap!!

It's that final drive to pick stuff up at the store that uses the most fuel in the transport chain. Fuel use for ocean transport, train transport and truck transport is tiny in comparison.