China on 19 March said it was sending an envoy to Washington to try to ease trade frictions as its currency regime comes under fire, warning that threats from US legislators could stifle room for progress.
The announcement, along with conciliatory comments by China’s commerce ministry, appeared aimed at cooling an increasingly rancorous dispute that has US senators threatening to slap duties on Chinese products if Beijing does not allow the yuan to rise.
Political pressure is certainly building. Many in the US Congress are demanding tough action if China resists appreciation. The US Treasury will next month issue a key currency report, and contention over policy towards China could be magnified by mid-term Congressional elections in November.
"Sending an official to Washington sends a signal that China wants to talk through these issues and doesn’t want to escalate this conflict," said Wang Yong, a professor at Peking University who studies China-US economic ties.
(Source: Business Standard)