IF EVER any cause deserved to be labeled ambitious -- if not quixotic -- harmonizing national economic policies around the world would seem to be it. For many years, the seven leading industrial nations labored mightily to avoid undercutting one another's prosperity. And when the Group of 20 became the world's would-be board of directors amid financial panic nearly a year ago, coordination became, if anything, more challenging.
Still, as the finance ministers of the G-20, which includes such rising powers as China, Brazil and India, prepare to meet on June 26, there is a modicum of good news, some of it at least partly attributable to Obama administration diplomacy. First, China has announced that it will permit its currency, the renminbi, to appreciate against the U.S. dollar, as Treasury Secretary Timothy F. Geithner and other officials have been urging. Though the precise speed and quantity of the revaluation remain to be seen, Beijing's statements implied that the government, having come to the conclusion that an artificially cheap currency threatens China with inflation and social unrest, is beginning a longer-term shift away from dependence on export-led growth. And that can only be good for both China's consumers and the rest of the world's economies -- especially the United States, since a stronger Chinese currency improves the competitive position of American industries.
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