Treasury nominee eases fears over China trade war

Steven Mnuchin waits to testify before a Senate Finance Committee confirmation hearing on his nomination to be Treasury secretary in Washington, US, on Jan 19, 2017.
Steven Mnuchin waits to testify before a Senate Finance Committee confirmation hearing on his nomination to be Treasury secretary in Washington, US, on Jan 19, 2017. PHOTO: REUTERS

WASHINGTON • United States treasury secretary nominee Steven Mnuchin said during his Senate confirmation hearing that he is willing to label China as a currency manipulator if warranted, after Mr Donald Trump backed away from his pledge to do so immediately.

Mr Mnuchin said "I would" when asked by Senator Robert Casey on Thursday whether he would recommend naming the Asian country a manipulator if it deserved that label.

Mr Trump had already softened his stance on China's currency policy, saying in an interview this month with The Wall Street Journal that he would not name the country a manipulator on his first day in office, as previously promised.

"I would talk to them first," Mr Trump was cited as saying by the Journal. "Certainly they are manipulators. But I am not looking to do that."

Mr Casey, a Pennsylvania Democrat who in the past introduced legislation to crack down on China for what he said was cheating on trade through its currency practices, acknowledged that the country has "shifted of late" from efforts to deliberately weaken its exchange rate.

Mr Mnuchin, who did not object to that characterisation, also said in an interview on Nov 30 last year that he would name China a manipulator only after determining the label was deserved.

The lack of a tougher line from Mr Mnuchin on Thursday may further ease concerns that the incoming administration will clash with China and start a trade war.

His views on the country are significant because the Treasury Department is tasked with determining whether governments are providing their companies with unfair trade advantages.

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A version of this article appeared in the print edition of The Straits Times on January 21, 2017, with the headline 'Treasury nominee eases fears over China trade war'. Print Edition | Subscribe