By Tenzin Monlam
DHARAMSHALA, August 12: China has devalued the Yuan to a three -year low against the US Dollar, a move that had a ripple effect throughout the globe, according to media reports.
Calling it a ‘one-off depreciation’, China’s move to bring down the value of Yuan was welcomed by the International Monetary Fund (IMF) saying that it does not directly impact Chinese push to win the reserve currency status enjoyed by US dollar, Euro, Pound Sterling and Yen.
However, experts and analyst say China’s ultimate goal of devaluing the Yuan is to turn Yuan into a global reserve currency. The International Monetary Fund (IMF) is soon expected to announce whether or not Yuan will be included in the elite currency club.
The drop continued on Wednesday as the currency of world’s second largest economy witnessed a fall of 1 percent after falling 1.9 percent on Tuesday.
Tibetan activist and writer, Tenzin Tsundue, said, “Yuan’s devaluation is a survival tactic that China is restoring to at a time Xi Jin Ping is losing economic confidence. At such slump moments, PCR resorts to diversionary acts.”
Though the Central Bank of China may have claimed it as a “one-off measure’, statistics show a different picture, say analysts. China’s export has dropped 8.3 percent in July. Chinese stock market has been on a freefall since June. The weak trend is most likely to impact its growth projection of 7 percent this year and the year after as well, experts say.
A senior official in the Department of Finance of the Central Tibetan Administration (CTA) said that the fall may bring in more competitions from other economy since the labor cost will increase and neighboring countries like Bangladesh, Nepal and India can benefit from it.
“With drop in the value of the currency, the cost of living will soar and livelihood of many Tibetans living under poverty line will be affected,” the official said.
According to Xinhua, China’s official mouthpiece, more than 34 percent of Tibetans in Tibetan Autonomous Region (TAR) lived below the poverty line as per 2014 statistics. TAR has the highest rate of poverty in the People’s Republic of China (PCR).
