Serious stuff! This is clearly unfair international competition!
If so, then this is another, major reason for Western countries to wake up quickly!
So maybe President Trump was also in this respect justified to impose tariffs on China.
"Yes, major financial institutions and international organizations estimate that China’s yuan is significantly undervalued.
According to the International Monetary Fund (IMF), the currency is roughly 21% cheaper than its economic fundamentals imply, while Goldman Sachs and independent trade experts place the figure even higher, between 25% and 35%.
While China historically used explicit currency manipulation, its [current] undervaluation stems from a mix of domestic economic factors and subtle state management.
The Historical Context: Deliberate Devaluation
From the 1980s through the early 2000s, China openly kept the yuan weak to fuel its rapid industrialization.
The Mechanism: The People's Bank of China (PBOC) bought up incoming foreign currency (like U.S. dollars) from exports and sold yuan to keep its own currency artificially cheap.
The Result: This accumulated nearly $4 trillion in foreign reserves by 2014, ensuring Chinese exports remained highly competitive globally." (Google Search)
"Four decades after the historic Plaza Accord, world leaders are facing growing pressure for a new currency agreement to tackle China’s undervalued yuan and massive trade surplus.
With Beijing’s export drive threatening industrial bases globally, currency intervention may be the only remaining way to force an economic rebalancing, Greg Ip argues."
Why the World Needs to Force China’s Yuan to Revalue (behind paywall, written by the Chief Economics Commentator Greg Ip, The Wall Street Journal) "China is flooding the world with cheap exports. An accord to revalue its currency might be the only solution."
