4. Assume you are a Chinese exporter. Would you prefer a Chinese export tariff on selected garment and textile exports as a way to relieve pressure against the yuan or a revaluation of the currency? Why?
If I were a textile exporter, I would prefer a revaluation of the currency to a selective tariff that would target only textile producers. This is because a broad devaluation would likely result in only minor strengthening of the yuan while a targeted export tariff would result in a much greater loss of competitiveness. If I were any other type of Chinese exporter, I would prefer the textile export tariff. It would have very little impact on my business but would reduce political pressure from foreign governments and lower the likelihood of future revaluations.