China Review News (CRN) recently published a commentary that discussed the action plan developed to fight the apparent global exchange rate war. After the United States announced its QE3 plan, Japan, Britain, European Union, India, and Australia all followed suit and announced more liberal currency policies. The commentary offered a five-point plan on how China should handle the situation: (1) Speed up the process of internationalizing the Chinese currency (RMB) in order to establish a better position in the world economy; (2) Improve the reliability of the supply of strategic energy and resource materials, which will help build up the national reserve and lower the pressure of currency appreciation; (3) Construct China’s own new financial marketplace to improve financial risk management; (4) Sell a certain amount of U.S. bonds, which will suffer devaluation after QE3; (5) Expand the scale of importing U.S. high-tech goods, including intellectual property.
Source: China Review News, October 10, 2012
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