MercoPress. South Atlantic News Agency

Biden tells China US power not waning and anticipates a bumpy 2012

The Vice-president said US nationals own 69% of Treasury bonds

US Vice President Joe Biden rejected views that US power is waning and said Washington would never default, wrapping up a China visit that has played down tensions between the world's two biggest economies. He also anticipated 2012 was a ‘transition year” both for the US and China

“We are still the single best bet in the world, in terms of where to invest” Biden told a university audience in Chengdu, the provincial capital of Sichuan, the southwest province that is the second and last stop of his visit to China.

“Please understand that no one cares more about this than we do, since Americans own 87% of all our financial assets and 69% of all our treasury bonds,” Biden said, answering a question about U.S. debt.

“So our interest is not just to protect Chinese investment. We have an overarching interest in protecting the investment, while the United States has never defaulted and never will default”, and insisted, “you’re safe”.

Biden spent five days in China trying to convince its hosts that the United States can reverse its high debt and low growth, and that China should play a part by buying more American-made goods and services.

“I also know that some of you are sceptical about the US future prospects. With that in view, I would like to suggest that I respectfully disagree with that view and will allay your concerns,” said Biden.

He told the audience to remember that the United States was by far the largest economy in the world, about two and a half times as large as China's.

Biden and President Barack Obama, both Democrats, face re-election next year. Biden said the debate with Republicans over how to tackle U.S. fiscal problems would be at the heart of the 2012 presidential election.

Chinese Vice President Xi Jinping, who is virtually certain to succeed Hu Jintao as Chinese President in early 2013, has hosted Biden during this visit. Obama administration officials have said they want to build trust with Xi ahead of the transition that begins in late 2012, when Hu gives up his post as general secretary of the ruling Communist Party.

Next year would need careful political footwork from both governments, said Biden.

”Both our countries are going through a political transition in 2012. It is very important, in my view, that we both are aware of the political sensitivities in each of the countries as they go through that period”.