China will retaliate if the United States declares China a currency manipulator and imposes trade sanctions, Commerce Minister Chen Deming said Sunday, firing the latest salvo in a spat over the value of the yuan. Chen again accused Washington of politicizing the issue ahead of an April 15 deadline for the US Treasury to rule whether China is unfairly holding down its exchange rate to gain a competitive edge in global markets. “The currency is a sovereign issue and should not be an issue to be discussed between two countries,” Chen told the China Development Forum. “We think the renminbi is not undervalued, but if the US Treasury gave an untrue reply for its own needs, we will wait and see. If such a reply is followed by trade sanctions, I think we will not do nothing. We will also respond if this means litigation under the global legal framework,” he added. Chen did not specify how Beijing might respond. Political pressure is growing in Washington to declare China a currency manipulator, with some US senators threatening to slap duties on Chinese products if Beijing does not allow the yuan, also known as the renminbi, to rise. The head of the Asian Development Bank (ADB) Sunday joined the chorus of calls for Beijing to abandon the peg of 6.83 yuan to the dollar imposed in mid-2008 to help China's exporters weather the global financial crisis. In the three years before that, Beijing had let the yuan climb 21 percent against the dollar.
