China to discuss trade issues with US Treasury Secretary

Photo: China to discuss trade issues with US Treasury Secretary

U.S. Treasury Secretary Henry Paulson and other officials are to discuss with China the Asian nation’s trade surplus.

However, the officials, speaking Friday at a background briefing for reporters, indicated no new willingness to allow the Chinese currency to appreciate faster against the dollar.

"We are ready to take measures to restore the trade balance," said a Ministry of Commerce official, speaking on routine condition of anonymity.

"In terms of China-U.S. trade we are ready to take various kinds of positive measures to increase our trade," he said, citing steps to boost Chinese investments in the U.S.

"We also want to point out that to address this issue not only China needs to take measures, the U.S. needs to take measures," the official said.

Paulson is facing growing pressure to secure results from next week's talks on Dec. 12-13, the third installment in a dialogue that has produced few breakthroughs at previous meetings in Beijing and Washington.

With the U.S. deficit with China on track this year to surpass last year's all-time high of US$233 billion, members of U.S. Congress are pushing the administration to act more forcefully to get China to halt what critics see as unfair trade practices. They contend China is manipulating its currency to keep the value low to boost Chinese imports into the United States while making U.S. goods more expensive in China.

The U.S. should shoulder its responsibility and help stabilize the global currency system by promoting a strong dollar, an official from the finance ministry said. This would help all developing countries, he said, by promoting stable economic development and financial markets.

China is committed to a reform of the Chinese currency he said and is moving forward with this. He did not give details.

Chinese officials have said they eventually will let the yuan trade freely on world markets. But they insist that dropping controls too quickly could damage frail Chinese banks and financial industries, causing economic turmoil.

China meanwhile is hoping for an agreement at the meeting on the contentious issue of food safety that has tarnished the country's exports.

The head of China's General Administration of Quality Supervision, Inspection and Quarantine, Li Changjiang, is due to attend the meetings, alongside U.S. Secretary of Health and Human Services Mike Leavitt, Secretary of Commerce Carlos Gutierrez and Acting Secretary of Agriculture Charles Conner.

Vice Premier Wu Yi, who is head of a Cabinet-level panel to improve China's product safety, is co-chairing the economic dialogue with Paulson.

China is also hoping to increase cooperation on energy efficiency and clean coal technology, an official from China's National Development and Reform Commission told reporters.

It also wants to discuss energy security and stabilization given the rise in oil prices this year. As China's economy has grown it has increasingly come into competition with the U.S. for energy resources around the world.

Zhou Shengxian, minister of the State Environmental Protection Agency will also attend the meetings.

While the Chinese side acknowledged the two sides don't always agree, they have no major difference in principal, an official in the foreign ministry said.