The appreciation of the Chinese currency RMB would wipe out millions of jobs in China, and worsen the country's already－grim employment situation, leading labor experts and economists warned. The warning came as the government, in its latest effort, made clear its determination not to allow its currency to appreciate, at least in the short run.
Experts say, an expected drop in exports and foreign direct investment will cost jobs if the government caves in to growing international pressure to raise the value of the RMB.
Despite an overseas chorus led by Japan to press Beijing to revalue the RMB, both Chinese officials and economic researchers said that maintaining the stability of the currency is conducive to the national economy as well as a global economic recovery. A revaluation of the RMB may plunge the Chinese economy into a long－term recession.
Cheap labor costs have been considered as the biggest contribution to the county's surging exports. A RMB revaluation, however, will definitely undermine the advantage of competitively－priced Chinese exports, most of which are from labor－intensive manufacturing industries.
The prospect of huge job cuts to be caused by a RMB revaluation is something China cannot afford.
(CCTV July 28, 2003)
