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US, Chinese officials target protectionism

The US and China, with increasingly dependent economies, have to work together to fight protectionist sentiment in both countries, officials from both nations said yesterday.

The comments came on the eve of high-level meetings this week between US Treasury Secretary Henry Paulson and Chinese officials at which China's massive trade surplus with the US and its product safety record are expected to be key issues.

"We have to continue opening global markets. America and China must work together to stem the tide of projectionist sentiment in out nations," said US Secretary of Commerce Carlos Gutierrez.

"It is ironic that we have found that protectionism does not protect. The only thing that does protect is innovation and engaging with the world, competing, being more productive," Gutierrez told a seminar on innovation in Beijing.

Gutierrez also pointed to China's reputation for lax enforcement of intellectual property rights, calling for "consistent, transparent and equitable" rules to guarantee that innovation will not be stifled.

Congress has been demanding the US administration act more forcefully to get China to halt what critics see as unfair trade practices. They contend China is manipulating its currency to keep the value low to boost Chinese imports into the US while making US goods more expensive in China, inflating the US trade deficit with China, which last year reached a record US$233 billion.

US Health Secretary Mike Leavitt said China and Western countries needed to cooperate because the global market had changed so much that governments had lagged behind in regulating their booming trade.

"Our systems our different and yet we need to achieve a common result ... it's a question of building bridges," Leavitt said in a separate speech to the American Chamber of Commerce in Beijing.

Leavitt, who will sign an agreement today on food and feed product safety, and a second on drugs and medical devices, quoted a Chinese proverb in saying the bridge-building would take time.

"The man who removes a mountain begins by carrying away small stones," he said. "This is not about the US and China, this is about the world," Leavitt said.

Their comments were echoed by published remarks from Chinese officials.

Chinese Finance Minister Xie Xuren (謝旭人) said in an interview with the official Xinhua news agency that the protectionist sentiment in the US Congress was alarming.

"At present, the tendency within Congress toward protectionism is in fact rather worrying," Xie said.

He added the passage of such legislation would "seriously harm China-US trade cooperation, and in the end, harm America's own interests."

Chinese Vice Commerce Minister Chen Deming (陳德銘) was also quoted yesterday in the official China Daily as saying the trade disputes with the US should be resolved through talks.

He said a narrow focus on the value of the yuan and intellectual property rights risked "hindering the normal development" of trade links.

Paulson said last week in Washington that US worries about Chinese product safety will be a major topic at the Strategic Economic Dialogue meeting to be held just outside Beijing starting tomorrow.

China's ability to manage the safety of its goods will be an important part of Beijing's future growth and its trade relations with the US, he said.

Paulson and other senior Bush administration officials in China for the third round of the talks. Paulson launched the effort a year ago, but so far it has produced few results. Chinese Vice Premier Wu Yi (吳儀) leads the Chinese side.

Gutierrez later attended a ceremony where Wal-Mart China announced it had received approval to open its 100th store in China. It will open in Loudi, Hunan Province.

About 80 Wal-Mart employees wearing red shirts were on hand in a Beijing hotel. US products sold in Wal-Mart stores in China, such as Hunt's barbecue sauce and apples from Washington state, were on display.
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