Economy

China-US S&ED, a transpacific conversation for co-op

(Xinhua)
Updated: 2011-05-12 16:18

WASHINGTON -- US Treasury Secretary Timothy Geithner is an old China hand who probably would not pass on any chance to showcase his fluent Mandarin.

But when he used a Chinese proverb "you fu tong xiang, you nan tong dang" - meaning "share fortunes together, meet challenges together" in English - at the opening session of the third round of the China-US Strategic and Economic Dialogue here (S&ED) on Monday, he did it rather to sum up the desire of both the American and Chinese delegations for mutual benefit and cooperation.

After two days of intense discussions, that spirit of cooperation has resulted in a sweep of agreements concerning trade, investment, financial reform, military and security.

Chief Chinese delegate Vice-Premier Wang Qishan described the talks as a "great success" while US Secretary of State Hillary Clinton called them "productive and comprehensive," with a long list of agreements and understandings reached.

Consensus on economic issues

Related readings:  China-US dialogue reaps benefits  US companies eye Chinese market for growth  China, US vow to building better business environment  China-US dialogue reaps benefits

On the economic track of the dialogue, co-chaired by Wang and Geithner, both sides agreed they made progress on a wide range of topics such as currency exchange rate, fairer competition, more balanced trade, and stronger economic cooperation.

More importantly, the two sides signed a China-US comprehensive framework for promoting strong, sustainable, and balanced economic growth and cooperation.

Chinese Deputy Finance Minister Zhu Guangyao said the key document is a "milestone" for China-US economic cooperation.

Huang Shengzhong, a professor at China's Southwest University of Political Science and Law, told Xinhua that the framework has demonstrated that China and the US share the will for even broader and closer economic cooperation.

According to the framework document, the economic relationship between China and the US is based on a wide range of common and overlapping interests.

Each recognizes that "the health and continued growth of the other's economy is indispensable to its own prosperity."

Both countries also pledged to "promote more extensive economic cooperation, from a strategic, long-term, and overarching perspective, to work together to build a comprehensive and mutually beneficial economic partnership."

Prior to the opening of the meeting, China and the US had been at odds with each other over China's currency evaluation.

The United States complained that China had undervalued the RMB, and urged Beijing to appreciate its currency. China, on the other hand, said America's quantitative easing policy and huge budget deficits are the major reason for causing the problem and endangering China's large dollar assets.

To bridge the differences, the two nations pledged in the framework to "work with other nations to maintain a stable international monetary environment. The United States promises to keep vigilant against excess volatility in exchange rates while China to continue to enhance the flexibility of RMB exchange rate."

Another major accomplishment achieved by the two countries in the dialogue was to sustain fair competition for their companies and investors. The issue has been a controversial one for both countries.

The US accused China of not giving its firms the same equal treatment that China's state-sponsored enterprises enjoy. China stoutly denies the accusation.

Seeking to settle their disputes, the two nations, according to their agreement, are committed to "fostering open and fair investment environments, and continuing to promote transparency and for investors of both countries."

In an apparent concession to Chinese demands, the United States promised China to relax its high-tech exports controls towards China and to grant China market economy status in an expeditious and a comprehensive manner, said Wang.

"We're very confident we're going to see substantial, ongoing improvement in the opportunities that American companies have in the Chinese market, both American companies operating in China and companies that are creating, building things in the United States, " Geithner said.

Yao Wei, an economist with France's Societe Generale, told Xinhua that the third S&ED is quite fruitful, suggesting that bilateral economic cooperation has achieved substantial progress.