MEDIA REACTION: RMB EXCHANGE RATE, DALAI LAMA MEETING

UNCLAS SECTION 01 OF 02 BEIJING 000429 DEPARTMENT FOR INR/R/MR, EAP/CM, EAP/PA, EAP/PD, C HQ PACOM FOR PUBLIC DIPLOMACY ADVISOR (J007) SIPDIS E.O. 12958: N/A TAGS: PREL ECON SENV KGHG KMDR OPRC CH SUBJECT: MEDIA REACTION: RMB EXCHANGE RATE, DALAI LAMA MEETING -------------- Editorial Quotes -------------- ¶1. RMB EXCHANGE RATE a. "How to view China's decreased holding of U.S. Treasury bonds" The China Radio International sponsored newspaper World News Journal (Shijie Xinwenbao)(02/23)(pg 2): " Before the U.S. economy bottoms out, any appreciation of the U.S. dollar is only temporary and is manipulated. Under such circumstances, what the U.S. has gained by financial means relying on its currency hegemony is due to other countries' losses. This zero-sum game will only increase other countries' dissatisfaction and speed up the decline of the U.S. dollar. Before the U.S. dollar hegemony really begins to crack, like it or not, other countries, including China, have to play the financial game with the United States. China should be prepared for the collapse of the U.S. dollar hegemony. Based on in-depth research and predictions about the U.S. financial policy, between the U.S. dollar, American bonds and other assets, China should continue to buy low and sell high in order to minimize the cost of China's holdings of U.S. assets." b. "Exchange rate manipulator" becomes the United States' political card" The People's Daily-sponsored and internationally-focused commercial news publication Global Times (Huanqiu Shibao)(02/23)(pg 8): "The world's worries about the potential trade war between the world's biggest exporting country and importing country are growing. Zhou Shijian, senior researcher at Qinghua University, said that each country will take measures to maintain the stability of the exchange rate, even the U.S. Finance Department has an 'exchange rate stabilization fund.' China should not be afraid of being given the name 'exchange rate manipulator,' but should be vigilant about not repeating the Japanese yen's mistake where it was forced to appreciate. Japanese media said that the United States is the biggest 'exchange rate manipulator.' The U.S.'s only excuse for RMB appreciation is its trade deficit. However, when added to the U.S.'s overseas investment and its trade exchanges with multinational companies, the U.S. should be the country with the biggest trade surplus in the world. In history, there were numerous examples to show the U.S.'s manipulation of its exchange rate so as to execute its financial hegemony. It is a frequent practice of the U.S. to give the name of 'exchange rate manipulator' in order to other countries to bolster its political goals. Facing the threat, China should, on the one hand, let the Americans be aware of the rationality of the current RMB exchange rate, and on the other hand, speed up its economic transformation, expand domestic demand and meanwhile prepare countermeasures." c. "What does the U.S. want by playing the currency card?" Guangdong 21st Century Publishing Company Ltd.'s business newspaper 21st Century Business Herald (21Shiji Jingji Baodao)(02/22)(pg 1): "Knowing the RMB exchange rate will not solve the fiscal deficit of the U.S., or the other economic problems of the U.S., why does the U.S. still play the exchange rate card again and again? Answer, because it has other ulterior motives. What does the U.S. want? Answer, they want to use the RMB exchange rate as an excuse to impose trade sanctions against China. This should not be the case at all. Trade protection will only inhibit imports from China rather than increase U.S. exports. Knocking the door open to the Chinese market is more important to the U.S. Therefore, in the future, the U.S. will use the exchange rate to extort China and make a big fuss on China's market liberalization and industrial policy. The RMB exchange rate reform has to adhere to the principle of being independent, gradual and controllable, maintaining stable exchange rates at a reasonable and balanced level. International pressures will only add pressure and difficulties to the resumption of the reform." ¶2. DALAI LAMA "Does Obama really care about the Dalai Lama?" The China Radio International sponsored newspaper World News Journal (Shijie Xinwenbao)(02/23)(pg 2): "Wang Yusheng, the Executive Director of China Foundation for International and Strategic Studies, said that the Dalai Lama is merely a pawn of the United States. Saying Obama's meeting with the Dalai Lama is based on American values is both ignorant and arrogant. It is commonly objected to use the name of human rights to take hegemony and interfere in other country's internal affairs. It is just double talk to say that the Dalai is a somewhat religious and cultural leader. In fact, the American leaders know very well that he is only a pawn for splitting China. Saying that U.S.-China relations should be mature enough to withstand this test is a form of wishful BEIJING 00000429 002 OF 002 thinking. Chinese leaders have made its stance clear that it firmly opposes any state leader or officials meeting the Dalai Lama. Didn't President Obama, as smart as he is, hear clearly? Aren't American leaders and those who uphold American values supposed to reflect about this?" HUNTSMAN