The Bush administration recently vowed to increase its efforts to push for the successful conclusion of the Doha Development Round of Trade Talks. At the same time, it discussed several benefits that could be enjoyed by China if the country improved the flexibility of its currency. According to a report concerning the US economy, free and open global trade was important to growing and stable economies. The report also said that the United States would continue to work for the completion of the global trade talks under the World Trade Organization (WTO).

The annual report that was released by the White House Council of Economic Advisers also tackled the currency issue involving China. The report cited the Asian nation as an example of countries practicing fixed exchange-rate without taking into consideration the effects of the economic policy. It must be noted that the US has been urging China to adjust the value of its yuan and make the currency more flexible in global trade. The low value of yuan has been blamed by many US industries as one of the main factors behind the huge trade gap between the US and China.

According to the report, one of the benefits of having flexible rates is that the policy allows more leeway in controlling domestic inflation. Meanwhile, Edward Lazear said that the Bush administration was trying to remain "agnostic" in considering whether one type of monetary rule was preferable to another currency policy. It must be noted that a bipartisan group of legislators led by Ohio Democratic Rep. Tim Ryan and California Republican Rep. Duncan Hunter recently proposed a bill that would consider currency manipulation as an unfair practice in global trade.

Sen. Charles Schumer, who is a New York Democrat, is among the legislators who have threatened to propose a bill that would impose tariffs on Chinese goods if Beijing failed to resolve the issue regarding its currency. Meanwhile, President George W. Bush called for the Congress to extend his fast-tack trade negotiating authority in the opening statement of the annual report. The fast-track trade authority of Mr. Bush plays a vital role in the on-going global trade talks. The special negotiating power enables the Bush administration to negotiate global trade pacts, which the Congress must approve or reject without making any change. Currently, the WTO members are pushing hard to complete the Doha Development Round of Trade Talks before the negotiating authority expires in July.