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News from U.S. Senator Olympia J. Snowe
Chair, Senate Committee on Small Business and Entrepreneurship
For Immediate Release: May 15, 2006
Contact: Chris Chichester, 202-228-5843

Snowe Continues Fight Against Chinese Government’s Currency Manipulation
Cautions Much More Remains To Be Done By Chinese Leaders Despite Today’s Appreciation

WASHINGTON, D.C. - U.S. Senator Olympia J. Snowe, Chair of the Senate Committee on Small Business and Entrepreneurship, issued the following statement in response to China’s announcement today that it has allowed its currency, the Yuan, to appreciate almost a tenth of a percent:

"Today’s action by the Chinese government is a step in the right direction toward a more flexible, market-based exchange rate for its currency. I caution that it is a small step and much more remains to be done by Chinese leaders to bring the Yuan in line with underlying market conditions so that American manufacturers and products are treated fairly in international markets.

"Despite today’s decision by Chinese leaders, I will continue to press for Senate consideration of the ‘Fair Currency Practices Act,’ legislation I introduced to force nations to live up to their treaty obligations and stop undervaluing their currencies. Currency manipulation must be addressed by Congress or American manufacturers and other industries will continue to confront international economic obstacles, which hurt their ability to create jobs, grow and compete in the global economy.”

The Fair Currency Practices Act (S. 984) has three key provisions. The first would alter the criteria by which the Treasury Department is required to enter into negotiations with foreign countries that it labels as currency manipulators. The second would further clarify the working definition of manipulation under the Exchange Rates and International Economic Policy Coordination Act of 1998. Finally, the Fair Currency Practices Act would instruct Treasury to undertake an extensive examination of China's trade surplus, with particular attention paid to China's suspect trade data, and report on its findings.


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