Don't look at the RMB, sell us airplanes instead!
Do you remember these words spoken in November 2004 by People's Bank of China Deputy Governor Li Ruogu?
The appreciation of the RMB will not solve the problems of unemployment in the US because the cost of labour in China is only three per cent that of US labour. They should give up textiles, shoe-making and even agriculture probably. . . . They should concentrate on sectors like aerospace and then sell those things to us and we would spend billions on this. We could easily balance the trade.”Well, it looks like one shouldn't take such talk too seriously. At least the part about buying from the United States. Because China has no intention of "balancing" trade with the US.
China ordered 150 Airbus single-aisle A320 airliners Monday, more than twice as many plane orders than the company's U.S.-based rival Boeing Co. snagged from China last month.So what again is the US going to sell to the world so as to begin tackling its $700bn annual trade deficit?
The European aircraft manufacturer said the deal was worth nearly $10 billion and was ''the largest single order that Airbus has ever received since it entered the Chinese market two decades ago.'' . . .
The order upstages China's purchase last month of 70 Boeing jets during a visit to Beijing by President Bush. At list prices that deal was worth about $4 billion, although buyers typically get discounts on big orders.
Until now, Chicago-based Boeing has won about 60 percent of new plane orders from China, with Airbus taking about one-third.