Special Report: First Round Sino-U.S. Strategic and Economic Dialogue>>
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China and the US reached agreement on the need to work toward more balanced
global growth once the economic crisis has ended, US Treasury Secretary Timothy
Geithner said Tuesday.
China and US concluded talks aimed at narrowing differences on a wide range of economic and foreign policy issues.
US Treasury Secretary Timothy Geithner (L) shakes hands with Chinese Vice Premier Wang Qishan as he arrives at the Economic Track Opening Session of the US-China Strategic and Economic Dialogue at the Treasury Department in Washington July 28, 2009.
The two countries signed a memorandum of understanding on climate change and
clean energy cooperatoin and issued a joint work plan to set the agenda for
coordination between the two nations over the next several years
Chinese Vice-Premier Wang Qishan voiced support for a key US goal that China
shift to more domestic-led growth rather than rely on exports that drive up the
US trade deficit.
"China will focus on boosting domestic demand and in particular consumer demand," Wang said.
China had implemented measures to stimulate domestic consumption and reduce
dependence on exports even before the financial crisis hit last year.
Wang said the US should treat Chinese enterprises investing in the US
"equally" and ensure the security of Chinese assets in the US.
He urged the US to relax its limit on high-tech exports to China.
He also said the two sides should abide by WTO rules and shun trade
protectionism.
Geithner was accompanied during the talks by National Economic Council
Director Lawrence Summers and US Trade Representative Ron Kirk, while the
Chinese team included Zhou Xiaochuan, head of the People's Bank of China.
"We can build upon our joint response to the global financial crisis by
continuing to provide constructive leadership and support for the institutions
underpinning global financial stability," Geithner said.
Geithner said the Strategic and Economic Dialogue with China provided a
platform for narrowing differences and reinforcing common interests between the
two countries.
"We are laying a stable foundation for cooperation on our long-term
objectives," he said.
Secretary of State Hillary Rodham Clinton was leading a separate set of
discussions on foreign policy concerns.
Officials of both China and the US were striking a conciliatory tone, but
that did not stop officials of both countries from posing pointed questions
during closed-door discussions.
China, worried about its huge investments in the US, quizzed US officials about America's soaring budget deficits, while the Obama administration pressed China on the need to rebalance its economy to focus more on domestic-led growth rather than relying on exports to the US.
China's State Councillor Dai Bingguo (bottom row, 5th L), China's Vice Premier Wang Qishan (6th L), US Secretary of State Hillary Clinton (5th R) and US Treasury Secretary Timothy Geithner (4th R) stand with participants in the first joint meeting of the US-China Strategic and Economic Dialogue for a family photo in Washington July 27, 2009.
Officials from both nations played down the prospects for any breakthroughs
this week on the major issues that separate the two nations, such as carbon
emissions.
Wang said China's attempts to create a more open economy would help US
recovery efforts.
"With the furthering of China's reform and more openness, China and the United States will have even closer economic cooperation and trade relations and the China-US relationship will surely keep moving forward," Wang said.
Obama dispatched his top economic officials - Geithner, Summers, White House
budget director Peter Orszag and Federal Reserve Chairman Ben Bernanke - to try
to reassure China that the US will not let deficits or inflation jeopardize the
value of Chinese investments.
US officials said the president's team told the Chinese that the US was
committed to policies that would not fuel inflation.
They stressed that the US has a plan to bring the deficit down once the
economic crisis has been resolved. Bernanke, they said, discussed the Fed's exit
strategy from the central bank's current period of extraordinary monetary
easing, emphasizing it was being careful to guard against future inflation.
China, which has the largest foreign holdings of US Treasury debt at $801.5 billion, has been expressing worries that soaring deficits could spark inflation or a sudden drop in the value of the dollar, thus jeopardizing their investments. Chinese officials said those concerns were raised during the talks.
Special Report: First Round Sino-U.S. Strategic and Economic Dialogue>>