China slams US currency bill as threat to trade

China criticized an American currency bill as a threat to a shaky global economic recovery and warned Wednesday that trade ties will be "severely damaged" if it becomes law.

Beijing rejected the measure passed Tuesday by the Senate as a form of damaging protectionism at a time when other nations are trying to sustain free trade. The bill would allow Washington to raise tariffs on Chinese imports that critics say are unfairly cheap due to Beijing's exchange-rate controls and are destroying U.S. jobs.

"It is completely harmful and unbeneficial," said Foreign Ministry spokesman Ma Zhaoxu in a statement. Ma said it would do nothing to reduce U.S. unemployment and would disrupt global efforts to revive economic growth.

Tuesday's 63-35 Senate vote showed a bipartisan consensus in favor of tougher action against Beijing after years of diplomatic pressure and a gradual rise in China's currency, the yuan, that critics say is inadequate.

Still, the bill is unlikely to become law because it lacks the support of the majority Republican leadership in the lower House of Representatives, who are reluctant to take up the measure. The White House and President Barack Obama have not come out against the bill but have shown they are uncomfortable with it.