The Fair Currency Alliance (FCA) released the second in a series of briefs focusing on the degree of undervaluation of China’s currency.

“There is consensus among economists worldwide that China’s currency is, and has been, substantially and persistently undervalued,” said David A Hartquist, spokesperson for the alliance. “The undervalued Yuan puts U.S. companies at a disadvantage whether competing in the United States, China or elsewhere.”

The alliance’s second brief, “Experts Agree: China’s Currency is Undervalued,” reflects undervaluation estimates ranging from a high of 75% to a low of 10%. The undervaluation estimates were reported by an array of international banking organizations and financial institutions.

“This artificial and manipulated exchange rate distorts trade and is a further threat to the eroding American manufacturing base,” Hartquist continued. “China should promptly appreciate the value of the Yuan by up to 40% so that U.S. manufacturers and service providers can compete on a fair and equitable basis.”

The Fair Currency Alliance is a coalition of U.S. industrial, service, agricultural, and labor associations working to reverse the injury that the tightly-controlled and undervalued Chinese currency has on U.S. commerce and the global marketplace. FCA views China’s exchange rate policies as equivalent to an illegal subsidy, which is a violation of China’s WTO and IMF obligations. It contends that - because the exchange rate does not reflect market conditions - American exports to China are artificially priced higher, while Chinese products are priced lower in the U.S. market. On a global scale, FCA warns that China’s failure to adjust exchange rates in an orderly and timely manner could result in another Asian financial crisis with severe implications for workers, manufacturers and service providers worldwide.

FCA’s Brief No. 1 focused on China’s inaccurate trade data and how it distorts the degree of currency manipulation. Future topics will include the impact that the undervalued Yuan has on the Chinese economy and the global financial system; China’s violations of international trade and financial agreements; and steps that the U.S. government should take to ensure parity and fair play.

David A. Hartquist, an international trade attorney with the Washington, DC law firm Collier Shannon Scott, PLLC, serves as counsel to the alliance.