Go easy on China over yuan: French advisers

7th June 2011, Comments 0 comments

French government economic advisers called Tuesday for Europe to strengthen trade ties with China and stop pressuring it to let the value of the yuan rise.

"We should take a gamble with China and take part actively in developing trade relations with this country, without underestimating the risks and difficulties of such a strategy," the Economic Analysis Council (CAE) wrote.

"Governments must not focus on the exchange rate as many are doing today," said the council, a panel of expert economists, in a report submitted to the French government.

China is widely accused of deliberately holding down the value of its currency to boost its exports at the expense of other countries.

The CAE insisted however that the yuan issue "is not the obsessional problem that it is sometimes presented as."

The yuan has been "appreciating in real terms since 2005," and this process "can only gain strength since a policy of quickly raising salaries has been put in place" in China, the CAE added, forecasting a fall in its trade deficit.

© 2011 AFP

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