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1 China reassures on Wed Nov 18, 2009 8:15 am

gypsy


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http://www.reuters.com/article/topNews/idUSTRE5AE15L20091118
My thoughts// I wish we did not owe China//Period!

(if you want rest of story just click!)
By Caren Bohan and Patricia Zengerle

BEIJING (Reuters) - Chinese Premier Wen Jiabao told President Barack Obama his nation does not seek a trade surplus with the United States and wants to balance flows, striking a conciliatory note but avoiding public comment on currency rifts.

Wen made the comments on Wednesday during a meeting with the U.S. President, according to a report on the Chinese Foreign Ministry website (www.mfa.gov.cn).

"China does not pursue a trade surplus," Wen said, adding that his government wants "to encourage a steady balancing of bilateral trade."

"Lively global trade and investment will help to overcome the international financial crisis and accelerate global economic recovery," said the Chinese Premier, also urging both countries to "together oppose trade and investment protectionism."

Wen's comments are unlikely to mollify U.S. industry groups and politicians who say Beijing is holding its yuan currency so low against the dollar that it is stoking a U.S. trade deficit with China and worsening global economic imbalances.

But Wen's reassuring language, as well as praise for Obama in Chinese state media, set a guardedly upbeat tone at the end of a four-day visit that exposed rifts over trade and currency policy.

"The West's perception of China has been changing gradually, and a positive turn has occurred as Obama has said more than once during his ongoing Asia tour that the United States would not seek to contain China's rise but welcome China as a strong and prosperous player in the community of nations," said a commentary issued by the official Xinhua news agency.

Obama's words "forged a good starting point to further Chinese-U.S. ties," it said.

After the talks with Wen, Obama visited the Great Wall, for Chinese people a proud symbol of their heritage.

NO COMMENT ON YUAN

But the absence of any comment on the yuan in Wen's published comments was a telling reminder of the rifts remaining as Obama prepared to head for South Korea on Wednesday evening.

The report said that Obama did raise reform of China's exchange rate policies.

At a summit on Tuesday, Obama made plain to Chinese President Hu Jintao that he wants movement on China's currency policy. Hu also avoided mentioning currencies in comments to reporters.

China has had a huge trade surplus with the United States, and is also the largest foreign holder of U.S. government bonds.

The U.S. trade deficit with China widened 9.2 percent in September to $22.1 billion, the highest since November 2008, according to U.S. data released last week. Continued...

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