China rejects US calls to revalue yuan

China has rejected calls from US lawmakers to appreciate the yuan, saying the currency's exchange rate is not to blame for a trade surplus.

China and the US remain locked in a heated argument a month out from a US Treasury Department ruling over whether China is manipulating its exchange rate.

A Chinese Ministry of Commerce spokesman Yao Jian on Tuesday dismissed US  demands for a stronger yuan.

A Chinese Ministry of Commerce spokesman on Tuesday dismissed US demands for a stronger yuan.

Yao Jian, Spokesman, Chinese Ministry of Commerce, said, "The trade surplus has not been caused by the yuan exchange rate. The trade surplus is an outcome and phenomenon of globalization. It will exist for some time to come. China has a trade deficit with some developing countries as well as Japan and South Korea. The issue is whether China should emulate the US and pass a law to deal with those countries. We hope that amid the economic recovery, the US will promote free trade and not obstruct it."

Yao was responding to a letter sent by 130 US lawmakers to US President Barack Obama on Monday. In the letter, they demanded he get tough with China over its currency practices.

Premier Wen Jiabao dismissed US complaints over China's exchange rate at a press conference on Sunday. The Premier called them counterproductive, and added he did not believe the yuan was undervalued.

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