Romney dismisses prospect of China trade war

US presidential candidate Mitt Romney dismissed suggestions that he would start a trade war with China as he and President Barack Obama both vowed a firm line with Beijing. Romney and Obama, who have both talked tough on China, adopted a milder tone on the Asian giant at their final presidential debate on Monday as they both pledged cooperation with the rising power despite disagreements on trade. "China's an adversary and also a potential partner in the international community if it's following the rules. So my attitude coming into office was that we are going to insist that China plays by the same rules as everybody else," Obama said at the debate in Boca Raton, Florida. Romney repeated his promise that, if elected, he would declare China to be a currency manipulator on his first day in office, charging that Beijing has kept its yuan artificially low to flood the market with cheap exports. Asked by moderator Bob Schieffer whether such a move would trigger a trade war between the world's two largest economies, Romney pointed to the gaping US trade deficit with China -- which stood at nearly $300 billion last year. "It's pretty clear who doesn't want a trade war. And there's one going on right now, which we don't know about," Romney said. "It's a silent one. And they're winning."Romney said that trade disputes with China went beyond currency rates. He recalled visiting a company that took in a faulty valve for repair under warranty and discovered that it had a duplicate serial number. "There were counterfeit products being made overseas with the same serial number as a US company, the same packaging, these were being sold into our market and around the world as if they were made by the US competitor. This can't go on," Romney said. But Romney, who has sharply criticized Obama in the past as allegedly failing to stand up to the rising power, said that the United States and China "don't have to be an adversary in any way, shape or form." "I want a great relationship with China. China can be our partner. But that doesn't mean they can just roll all over us and steal our jobs on an unfair basis," Romney said. Under Obama, the Treasury Department has stopped short of declaring China a currency manipulator -- a step that could trigger retaliation against imports -- and has instead preferred behind-the-scenes diplomacy.Obama, while pledging to do more, said that China's currency rate was at its "most advantageous point" for US manufacturers since 1993 and that US exports have doubled since he entered office in January 2009. "We absolutely have to make more progress, and that's why we're going to keep on pressing," Obama said. China has allowed its yuan to appreciate against the dollar by some 30 percent since 2005. While China has faced international pressure, many analysts say Beijing has largely been responding to inflationary pressure. Scott Paul, executive director of the Alliance for American Manufacturing, a group formed by leading manufacturers and the United Steelworkers union, said Romney was "absolutely right on who has leverage in the US-China relationship." "About one-third of Chinese exports end up in the US. Our consumer market is the best leverage we have. The idea of a trade war is nonsense," he said. Paul also praised Obama's focus on manufacturing in his remarks and said: "It's clear that both candidates believe it is critically important that China play by the rules." Charles Franklin, a political science professor at the University of Wisconsin-Madison, said the currency manipulation question marked a rare point of "real difference" between Romney and Obama. But the issue is "probably esoteric enough that it is hardly the primary motivation for voters going to the polls in November," he said. John Frisbie, president of the US-China Business Council, which is made up of companies that do business with the Asian power, said that the top priority to support the US economy should be action at home. "Both presidential candidates have said they will 'get tough' on China, but evidence has shown that the best way to make progress is through comprehensive engagement and legal actions -- not political rhetoric," he said.