Sino-US talks focus on economy, Pyongyang

09:11, May 24, 2010      

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China and the United States formally open high-level talks Monday intended to solidify their relationship and economic partnership, but analysts say that Pyongyang would emerge as a focus of discussion.

Reflecting the important of the annual Beijing-Washington talks, US Secretary of State Hillary Clinton said over the weekend that the more than 200-strong US delegation was "the largest group of American government officials ever to come to a meeting anywhere in the world".

As the two governments determined to improve their ties, any prior feuding over China's yuan exchange rate, however, appeared likely to be kept out of the limelight, analysts said.

The two countries are holding a Strategic and Economic Dialogue (S&ED) in Beijing, and Clinton said they would cover many of the commercial and foreign policy issues that have sometimes created rifts between the two powers.

"We want to take what is a positive relationship and make it more so. It's strong but it can be stronger," Clinton told the Hong Kong Phoenix Television late on Sunday.

Clinton said the issues up for discussion included bilateral economic ties, Iran and also North Korea, which faces international censure after South Korea said last week that Pyongyang torpedoed its warship, the Cheonan, killing 46 sailors in late March.South Korea said on Sunday it would take the case to the United Nations Security Council. Speaking in Tokyo on Friday, Clinton said the international community could not allow the Cheonan's sinking, to go "unanswered."

On the eve of the S&ED, China stressed the risks both economies face from Europe's debt woes. In comments published Sunday, Chinese Finance Minister Xie Xuren said cooperation with Washington was all the more important in the face of the European debt crisis.

"At present, risks from European sovereign debt have increased factors of instability in the slow course of global recovery", Xie wrote in the Washington Post.

For now, observers say, contention over China's yuan exchange rate policies appears unlikely to break out in public at the two-day Beijing talks.

The Obama administration appears willing to go along in the hope that a quieter approach will give Beijing more political space to let its currency appreciate in value.

Treasury Secretary Timothy Geithner told reporters Sunday that the two big economies needed to show they can act decisively.

"Meeting at this time allows us to demonstrate what is a substantial strength of both the United States and China -- a capacity to act quickly, to solve problems, to take initiative and to take a leadership role," Geithner said in Beijing.

But he and other U.S. officials will be looking for signs that China will narrow the two countries' huge trade gap.

The annual U.S. trade deficit with China fell to US$227 billion in 2009, down from a record US$268 billion in 2008. But the Obama administration is keen to lift exports, and the US deficit remains a point of friction with Beijing.

US President is vigorously pushing for expanding American exports so as to create more jobs at home. China's rapidly growing market is what Washington trade officials have aimed at to boost exports.

People's Daily Online


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