Reuters:

Are the U.S. trade measures beyond China's initial expectation? Will the RMB exchange rate be a topic during the negotiations between China and the U.S.? Thank you.

Zhu Guangyao:

China and the United States keep close communication; even facing severe differences, we still maintain policy communication. China has made its principle clear. The Chinese Ministry of Commerce, representing the position of the Chinese government, clearly stated that we will not negotiate under the Section 301 framework. This is a basic principle, because the U.S. action is a unilateral one. We hope that the two sides can clearly put forward their policy requirements  and seek new ways to solve the problem based on the principle of mutual respect. The most important thing is mutual respect, and then we can achieve win-win cooperation. 

Both of us have the responsibilities and obligations to manage our expectations, because China and the United States are the two largest economies in the world, and their policies not only have a major impact on their respective economies, but also have a major impact on the global economy. The global multilateral system must be maintained by all WTO members. In this process, both China and the United States have significant responsibilities. In this process, all countries must realize that hegemonism and unilateralism are unpopular. In safeguarding the multilateral system, we must work together because the United States has always played a leading role in the global economic system that has been established since World War II. China is an important participant, builder, and contributor to this system, and of course, it is also a beneficiary. We are willing to work with all of you to maintain this multilateral system through cooperation – constructive cooperation – so that our global economy can move forward and develop in a healthy and stable manner.

Regarding the exchange rate issue, the IMF recently made a very clear definition of the exchange rate, including the fundamentals of the economy, sound macroeconomic policies and sound mechanisms. Under this premise, the determination of exchange rates reflects the strength of the market. I think that China and the U.S., as important members of the International Monetary Fund and important participants and defenders of the international financial market, both shoulder common responsibilities. Cooperation in this area is conducive to the stability of the financial market, helps prevent possible systemic financial risks and contributes to the healthy and sustainable development of the world economy. Thank you.

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