Today, Chinese economic situation is much better than most of other industry countries. Although Chinese GDP growth slowed for SARS from 9.9 percent in the first quarter, it still grew 8.2 percent in the first half of the year. It is much more higher than just 1-2% of other main industry countries, such as Japan, European Union, and the United States. In addition, the foreign direct investment rose by 34.4% while trade surplus extended to 4.5 billion U.S dollars that was mainly contributed by the trade with the United States. The United States, European Union and Japan stated that China is plundering their global market share with unfair competition advantage, which is made by cheap currency policy. They complained that China is keeping the international value of its currency low to make its exports cheaper when purchased with other currencies, like dollars. "The Chinese Yuan has been tightly pegged to the U.S. dollar," they said. "Given China's enormous growth since 1994, this fixed level most likely does not reflect its true value." (http://www.bizjournals.com/pacific/stories/2003/07/14/daily48.html?jst=s_rs_hl) .
Revaluation of Chinese Yuan has becoming the hottest issue in the world presently. "For weeks, everyone from Fed Chairman Alan Greenspan to U.S Treasury Secretary John W. Snow to European Central Bank President Wim Duisenberg have been warning of the consequences if Beijing does not revalue its currency which at its current fixed rate of 8.28 to the greenback may be undervalued by as much as30%". (Clifford 2003) There are many countries especially the United States and Japan claimed that China is nibbling the global market by keeping Renminbi artificially cheap. In addition, China is building a dangerous huge foreign currency reserve. They argued that Renminbi should be appreciated at once. However, appreciation of Renminbi is not the best way for no matter Japan, America or China.
Japan.
