Is there a point in calling China a currency manipulator?

Will calling China a currency manipulator let an American government slap new tariffs on China?

Mitt Romney says he’ll brand China a currency manipulator on Day 1 of his presidency “which will allow me…to put in place tariffs…where I believe China is taking unfair advantage” Will it?

Not according to the US law that established the concept of “currency manipulation”. Which, ultimately, is why Barrack Obama, once he was in office, wriggled his way out of a similar commitment he made during the 2008 election. What branding the Chinese lets a President do is start a string of events which, if the US courts allow it and isn’t then over-ridden by the World Trade Organisation, allow higher tariffs a year or two later. But it looks very likely indeed the President won’t be able to impose higher tariffs – just get locked into a years-long legal battle with the Chinese.

Now it’s none of our business why people who want to be US President make claims about their powers as President that are just plain wrong. But it is our business to point out that if Romney wins, he’ll probably upset the Chinese more than Obama has – but he won’t suddenly cause the price of long-negotiated clothing contracts to soar 10% or 15%.

Bizarrely, the decision taken by Obama on October 31 to ally itself with Mexico’s WTO complaint against allegedly illegal Chinese export subsidies almost certainly does make higher US import duty on clothing more possible – though not for a year or two. Whether the US, overall, will decide to slap such tariffs on is another question. But Romney can call China whatever he likes: the blunt truth is what he calls China will have no effect at all on what tariffs the US imposes on the goods China makes.

Bangladesh crisis: June 25. Workers’ umbrella organisation demands immediate talks on doubled pay, unions and a wage board.

A group of workers’ representative organisations presented a claim to garment factory owners on June 25 for talks within 21 days which they claimed were a legal right, doubled wages, the establishment of unions and a reconstituted wage board. It is not clear how many of the country’s four million garment workers have any connection with the groups drafting the claim: one crucial part of the Bangladesh problem is the impossibility of determining workers’ wishes.

Bangladesh crisis: June 23. Crisis suspended: small Indian default highlights mid-August bonus time as next flash point risk

Bangladeshi garment factory owners pointed to the traditional bonus payments around the Eid festival as the next potential cause for worker violence../read more

Bangladesh crisis: June 22. Ashulia factories reopen peacefully if patchily: government and owners try to defuse wage hike claims

All but one garment factory in Ashulia re-opened on June 21, though many with a reduced workforce. Factory owners and government both looked to public subsidies and legislation to reduce workers’ living costs, and there seemed to be some localised agreements to increase wages.

Bangladesh crisis June 21: Ashulia factories reopen, but questions remain as Aminul Islam killers allegedly identified

Over 300 garment factories in Ashulia, closed since June 16, reopened on June 21. Early reports were that conditions in the area were calm, after the Bangladeshi government gave owners a security assurance. If the re-opening passes off peacefully, there are still a number of issues buyers need to bear in mind.

Bangladesh crisis threatens to spiral as owners and workers threaten expansion and government’s “wage rise” promise denied

Tensions in the Bangladesh garment industry seemed to be worsening on June 19 as both sides threatened to ratchet up their hostilities and the owners’ trade association had still not withdrawn its description of the government’s promise to increase wages as a “lie”. We are summarising daily developments in this fast-changing area of concern at a special summary page

Bangladesh crisis June 20: government denies earlier claims of wage agreements

The Bangladesh government June 19 denied claims – including one apparently made by one of its minsters – that an agreement had been reached to increase the country’s minimum wages. Its labour minster continued to insist workers’ protests were being instigated by outsiders