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China's “huge” trade imbalance with the United States is a structural and long-term problem and should be viewed with rationality, the Chinese central bank governor was quoted as saying by financial magazine Caixin.
Yi Gang, appointed to head the People's Bank of China in March, also called for concerted efforts from the United States and China to resolve the trade dispute, Caixin said in a report.
The comments came after an inconclusive two-day meeting between Chinese and U.S. top level officials in Beijing amid escalating tit-for-tat tariff threats between the world's two largest economies. Washington demanded that China reduce its trade surplus with the United States by at least $200 billion by the end of 2020, according to sources.
China had a record U.S. goods trade surplus of $375 billion in 2017.
The PBOC governor reiterated China's commitment to its prudent and neutral monetary policy and its focus on stabilizing its macro leverage ratio and reducing financial risks. On the currency front, Yi said that the PBOC has not intervened in the foreign exchange market for almost a year now, and authorities are committed to market-based foreign exchange rate reform.
China will also push for the convertibility of the capital account to coincide with the opening up of the financial sector, Yi said. However, in the process of opening up, China will step up the oversight of cross-border capital flows, prevent the contagion of cross-border financial risks and fend off international arbitrage, Yi said.
