China has huge investments in the United States and has worried it could be undermined by U.S. budget deficits
AP
Tuesday, July 28, 2009
WASHINGTON -- Treasury Secretary Timothy Geithner says he has reassured China that the United States will take steps to address rising budget deficits once the economic recovery is firmly in place.
China has huge investments in the United States and has worried it could be undermined by U.S. budget deficits. Geithner says the Obama administration plans to reverse the spending of hundreds of billions of dollars devoted to stimulating the economy and propping up a teetering financial system.
Geithner spoke at a news conference Tuesday capping two-days of high-level talks between Chinese envoys and U.S. officials. The talks concluded with the United States and China pledging closer cooperation to deal with global hot spots such as Iran's nuclear program and the world's worst financial crisis since the 1930s.
While Geithner and Secretary of State Hillary Clinton sought to portray the two days of high-level talks as a positive development in U.S.-China relations, the list of accomplishments on the economics side basically reaffirmed steps both nations already have taken to deal with the financial crisis.
On foreign policy, there were no apparent breakthoughs, although the countries pledged closer cooperation in dealing with the nuclear programs of North Korea and Iran.
Clinton conceded that differences remained in many areas such as human rights, but she said the candid discussions were important in building foundations for the two nations going forward.
"Laying the groundwork may not yield a lot of concrete achievements immediately, but every step is a good investment," she told reporters at a closing U.S. news conference.
President Obama, who is scheduled to travel to China before the end of this year, met with the two delegations in the Oval Office at the close of the talks Tuesday.
Clinton and Geithner and their Chinese counterparts, Vice Premier Wang Qishan, the country's top economic policymaker, and State Councilor Dai Bingguo, who oversees foreign policy, all expressed satisfaction with the outcome of the talks.
"In the wake of a severe global financial crisis, we agreed it is vitally important for China and the United States to see through their commitments to repair the financial system and lay the foundation for recovery," Geithner said at the closing news conference.
It was unclear whether the China side, long North Korea's strongest ally, had agreed to step up pressure on the North to return to six-nation disarmament talks or halt a provocative series of missile launches and nuclear tests. Those acts prompted the United Nations to impose the strictest sanctions ever on North Korea.
Also unclear was China's willingness to prod Iran to react to international objections to its nuclear program, although Clinton said the United States and China shared the view that Iran should not be allowed to develop atomic weapons. The Islamic republic insists its program is for electrical power and nothing more.
"I was also pleased that China shares our concerns about Iran becoming a nuclear weapons state. The potential for destabilizing the Middle East and (Persian) Gulf is viewed similarly by the Chinese as it is by us," Clinton said.
China, along with Russia, long has acted as a spoiler in efforts to impose more sanctions on Iran over its nuclear program. It has blocked attempts by Western nations at the U.N. Security Council to implement additional penalties until the country agrees to suspend nuclear activities that could lead to the development of an atomic weapon.
Both nations sought to play down disagreements on trade, exchange rates, and climate change and instead offered a picture of harmony with China pledging to work toward a key U.S. goal that it foster greater domestic-led growth to reduce its reliance on exporting to the United States.
For its part, the Obama administration pledged to tackle the budget deficit, which this year is projected to hit a record $1.84 trillion. That flood of red ink has left the Chinese, the world's largest holder of U.S. Treasury securities, distinctly nervous about the safety of their investments.
Geithner said the Chinese agreed to take steps to increase domestic consumption of its products.
The talks this week, which Obama opened Monday, represented a modification of discussions that were begun by the former Bush administration. Those talks, led by then-Treasury Secretary Henry Paulson, focused primarily on economic issues.
However, Obama expanded the agenda of the renamed Strategic and Economic Agenda to include not just economic disagreements but also foreign policy issues.
In his comments Tuesday, Wang voiced support for a key U.S. goal that China shift to more domestic-led growth rather than depending so much on exports that drive up the U.S. trade deficit.
"China will focus on boosting domestic demand and in particular consumer demand," Wang said, speaking through a translator. But Wang cautioned that this was "not an easy task" and would require "long-term and arduous efforts."
U.S. officials have expressed concerns in the past that China was moving too slowly in making the changes needed such as building a better social safety net that would encourage its citizens to spend more and save less.
Geithner repeated the commitment that the administration would trim its budget deficits once the spending necessary to jump-start the economy and stabilize the financial system had been completed.
However, private economists are worried that the administration has yet to put forward a credible plan to meet Obama's pledge to cut the deficit in half by the end of his first term in office. This year's imbalance is projected to be more than four times the size of last year's.
The economic talks on Tuesday focused on the need to fight against erecting protectionist trade barriers during the economic downturn. Other economic issues on the final day were ways to achieve the goal of overhauling the International Monetary Fund and other global financial agencies to give emerging economies such as China greater say in the operation of the institutions.
On climate control and energy, China did not signal any change in its refusal to agree to a specific cap on those emissions, but the two sides signed a document that Clinton said would create a platform for cooperation on climate change in the future heading into key climate negotiations in Copenhagen, Denmark, this year.
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AP
Tuesday, July 28, 2009
WASHINGTON -- Treasury Secretary Timothy Geithner says he has reassured China that the United States will take steps to address rising budget deficits once the economic recovery is firmly in place.
China has huge investments in the United States and has worried it could be undermined by U.S. budget deficits. Geithner says the Obama administration plans to reverse the spending of hundreds of billions of dollars devoted to stimulating the economy and propping up a teetering financial system.
Geithner spoke at a news conference Tuesday capping two-days of high-level talks between Chinese envoys and U.S. officials. The talks concluded with the United States and China pledging closer cooperation to deal with global hot spots such as Iran's nuclear program and the world's worst financial crisis since the 1930s.
While Geithner and Secretary of State Hillary Clinton sought to portray the two days of high-level talks as a positive development in U.S.-China relations, the list of accomplishments on the economics side basically reaffirmed steps both nations already have taken to deal with the financial crisis.
On foreign policy, there were no apparent breakthoughs, although the countries pledged closer cooperation in dealing with the nuclear programs of North Korea and Iran.
Clinton conceded that differences remained in many areas such as human rights, but she said the candid discussions were important in building foundations for the two nations going forward.
"Laying the groundwork may not yield a lot of concrete achievements immediately, but every step is a good investment," she told reporters at a closing U.S. news conference.
President Obama, who is scheduled to travel to China before the end of this year, met with the two delegations in the Oval Office at the close of the talks Tuesday.
Clinton and Geithner and their Chinese counterparts, Vice Premier Wang Qishan, the country's top economic policymaker, and State Councilor Dai Bingguo, who oversees foreign policy, all expressed satisfaction with the outcome of the talks.
"In the wake of a severe global financial crisis, we agreed it is vitally important for China and the United States to see through their commitments to repair the financial system and lay the foundation for recovery," Geithner said at the closing news conference.
It was unclear whether the China side, long North Korea's strongest ally, had agreed to step up pressure on the North to return to six-nation disarmament talks or halt a provocative series of missile launches and nuclear tests. Those acts prompted the United Nations to impose the strictest sanctions ever on North Korea.
Also unclear was China's willingness to prod Iran to react to international objections to its nuclear program, although Clinton said the United States and China shared the view that Iran should not be allowed to develop atomic weapons. The Islamic republic insists its program is for electrical power and nothing more.
"I was also pleased that China shares our concerns about Iran becoming a nuclear weapons state. The potential for destabilizing the Middle East and (Persian) Gulf is viewed similarly by the Chinese as it is by us," Clinton said.
China, along with Russia, long has acted as a spoiler in efforts to impose more sanctions on Iran over its nuclear program. It has blocked attempts by Western nations at the U.N. Security Council to implement additional penalties until the country agrees to suspend nuclear activities that could lead to the development of an atomic weapon.
Both nations sought to play down disagreements on trade, exchange rates, and climate change and instead offered a picture of harmony with China pledging to work toward a key U.S. goal that it foster greater domestic-led growth to reduce its reliance on exporting to the United States.
For its part, the Obama administration pledged to tackle the budget deficit, which this year is projected to hit a record $1.84 trillion. That flood of red ink has left the Chinese, the world's largest holder of U.S. Treasury securities, distinctly nervous about the safety of their investments.
Geithner said the Chinese agreed to take steps to increase domestic consumption of its products.
The talks this week, which Obama opened Monday, represented a modification of discussions that were begun by the former Bush administration. Those talks, led by then-Treasury Secretary Henry Paulson, focused primarily on economic issues.
However, Obama expanded the agenda of the renamed Strategic and Economic Agenda to include not just economic disagreements but also foreign policy issues.
In his comments Tuesday, Wang voiced support for a key U.S. goal that China shift to more domestic-led growth rather than depending so much on exports that drive up the U.S. trade deficit.
"China will focus on boosting domestic demand and in particular consumer demand," Wang said, speaking through a translator. But Wang cautioned that this was "not an easy task" and would require "long-term and arduous efforts."
U.S. officials have expressed concerns in the past that China was moving too slowly in making the changes needed such as building a better social safety net that would encourage its citizens to spend more and save less.
Geithner repeated the commitment that the administration would trim its budget deficits once the spending necessary to jump-start the economy and stabilize the financial system had been completed.
However, private economists are worried that the administration has yet to put forward a credible plan to meet Obama's pledge to cut the deficit in half by the end of his first term in office. This year's imbalance is projected to be more than four times the size of last year's.
The economic talks on Tuesday focused on the need to fight against erecting protectionist trade barriers during the economic downturn. Other economic issues on the final day were ways to achieve the goal of overhauling the International Monetary Fund and other global financial agencies to give emerging economies such as China greater say in the operation of the institutions.
On climate control and energy, China did not signal any change in its refusal to agree to a specific cap on those emissions, but the two sides signed a document that Clinton said would create a platform for cooperation on climate change in the future heading into key climate negotiations in Copenhagen, Denmark, this year.
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