MercoPress. South Atlantic News Agency

US/China talks reach no tangible results on currency

Further liberalization of aviation and financial services and greater collaboration on clean energy technologies are among “tangible results” of high-level bilateral talks between the United States and China, according to U.S. officials. But no “tangible results” were arrived on the controversial currency reform issue.

US Treasury Secretary Henry Paulson welcomed the results at the two-day meeting in Washington which Chinese Deputy Premier Wu Yi described as a e a success, but warned "complicated" relations between the two needed careful handling. A key issue at the Washington meeting was the value of the Yuan. US firms have accused China of keeping the Yuan low to boost exports, thus threatening American jobs. While the two sides failed to make progress on the issue, Mr Paulson told reporters he had pressed Beijing for greater flexibility for the currency. "This is an important area and they agree with us in principle ... the pace of change is picked up but I believe it would be very much in their best interests and the rest of the world's best interests for them to move more quickly," he added. Mr Paulson pointed to China's recent decision to allow the Yuan to appreciate each day from 0.3% to 0.5% as an "important signal" that changes may be in store. Among the deals agreed by the two sides during the talks, the most significant was one that requires China to ease limits on foreign investment in the country. The move should remove a bar on new foreign securities firms in China and allow foreign securities firms to expand their operations there. Meanwhile a further deal on the aviation sector should lead to a doubling in passenger flights between the two countries while cargo firms should have almost unlimited access to China. The head of the Chinese delegation Vice Premier Wu Yi, who on May 24 is scheduled to meet President George Bush said in her closing remarks that U.S.-China relations require careful handling. "The China-U.S. economic and trade relationship is one of the most complicated in today's world," she said. "It calls for direct consultation and dialogue between us, instead of easy resort to threat or sanctions." Hoping to head off punitive legislation, Wu and other members of her team â€" the largest high-level Chinese delegation ever to visit the United States â€" met behind closed doors with congressional leaders after the talks with members of President Bush's Cabinet had concluded. Wu, speaking through an interpreter, said her discussions with House Speaker Nancy Pelosi, Ways and Means Committee Chairman Charles Rangel and other House leaders on Wednesday were "very good" but she provided no details. Rangel told reporters that the Chinese told the lawmakers that they needed more time to implement reforms such as overhauling their currency system. He said his committee planned to move forward with legislation. Some of the bills being considered would impose stiff penalties on Chinese imports for what critics say are unfair trade practices. "I made it abundantly clear that we speak on behalf of the people of the United States," Rangel, D-N.Y., told reporters. Pelosi said in a statement that she and Wu had an "open and frank dialogue on issues such as intellectual property rights violations, the undervaluation of China's currency, the genocide in Darfur and human rights in China and Tibet. I believe the Chinese government can do more in each of these areas." Pelosi has been one of the vocal critics in Congress on China's human rights record.