US President Barack Obama said China recognized it could not sustain an export-driven growth model indefinitely but that it would take time to change.
Speaking to state governors at the White House, Obama urged them to press the US Congress to approve the Trans-Pacific Partnership trade pact to boost US exports in a region where China is “the 800-pound gorilla.”
Obama said it was tempting for China to try to solve its short-term problems by dumping state-subsidized goods into the US market but said his administration had made clear to China that would not work, Obama said.
“They recognize that they can’t forever sustain an export-driven growth model, but it’s going to take some time and it’s tempting for them to solve short-term problems by just dumping a bunch of state-subsidized goods into the US market,” Obama said in response to a question raising concerns about China’s exports of iron ore.
“We’ve been very clear with them about the fact that that’s not going to work, and we’re going to put in place tools to make sure it doesn’t work,” he said. Obama also said the United States had made clear China needed to have an orderly market-based currency system that did not advantage its companies over their US counterparts.
“Right now, frankly, their intervention is to prop up their currency rather than to devalue it, because a lot of people have been nervous about the Chinese economy,” he said.
