Sino-US relations at 15-year best: former US trade official

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Last updated at: (Beijing Time) Tuesday, November 04, 2003

Sino-US relations at 15-year best: former US trade official

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China and the United States are experiencing the first prolonged period of calm relations in about 15 years as their economies grow more closely linked, former US trade representative Charlene Barshefsky said at the 2003 annual conference of the Boao Forum for Asia Monday.

She said the United States and China share an interest in trade and the long-term success of economic reform in China, and have common ground in regional issues including the Asian financial crisis and the nuclear issue on the Korean peninsula.

The leaders of both countries are aware of the consequences should the relationship go fundamentally wrong, she added.

She said China's economic emergence can be traced through a shift in regional policy making

"First with its approach to the Asian financial crisis, more recently its proposal for a China-ASEAN free trade area, its position in the G-20 at Cancun and its new role as the largest local market for Asian exports, China is assuming an Asian economic leadership role," she said.

She said the political and diplomatic influence of China in the region is in large part a function of its emerging role as the economic driver of Asian growth.

Yuan not to blame for US deficit

China's currency exchange rate is not to blame for the United States' bilateral trade imbalance with China, said the former US Trade Representative.

"The yuan may be one of the problems, but not the only problem, and today it is not even not the major problem," Barshefsky said when she delivered a luncheon speech at the Boao Forum for Asia.

The tremendous export growth from China to the United States was partly due to US multinational companies which set up workshops in China and re-export to the United States, she said.

One of the evidence is that China's export earnings are helping finance the US federal budget deficit by using dollars to purchase US treasury bills, she said.

It is true that the US economy is facing with some immediate economic challenges and longer-term questions, while the Chinese economy is growing rapidly.

However, "this is not a simple story of Chinese growth at American expense," she added.

And China had taken positive steps last month to cut the export rebate rate from an average of 17 per cent to 13 per cent.

"It is a complex situation between the two sides and China has just played relatively minor role in America's growing imports as well as manufacturing job losses," Barshefsky said.

She urged the two nations to develop a firm bilateral trade relationship, adding that it is very important for Sino-US relations.

In recent months, frictions, focusing on trade and economic issues, between the United States and China, have begun to increase, and new challenge lies ahead for Sino-US economic relations.

But disputes could be solved through dialogue, she said: "If there is problem, it can be brought to the table and be discussed in a quiet, but more productive way."

By People's Daily Online

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