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China-US economic talks kick off US-China ties 'to shape century'
(about 8 hours later)
Top leaders of the US and China are meeting in Washington to discuss key economic and political differences. The relationship between the US and China will shape the 21st Century, President Barack Obama has said, as top officials met in Washington for talks.
President Obama said the relationship between the US and China would shape the 21st century and said the two shared a "mutual interest". "Co-operation, not confrontation" was the way forward, he said, with climate change, security and the economy all areas where common ground existed.
China has sent Vice Premier Wang Qishan and State Councillor Dai Bingguo. His comments opened two days of talks at a new forum between the two nations.
The meeting, called the US-China Strategic and Economic Dialogue, is the first formal negotiation between the US and China since Mr Obama took office. The US-China Strategic and Economic Dialogue is expected to focus on working towards economic recovery.
Treasury Secretary Timothy Geithner and Secretary of State Hillary Clinton are co-hosting the talks.
China has sent Vice Premier Wang Qishan and State Councillor Dai Bingguo to the forum.
'Strong coordination''Strong coordination'
The talks will cover a range of issues, including halting the spread of nuclear weapons in North Korea and Iran, and creating clean and secure energy sources.The talks will cover a range of issues, including halting the spread of nuclear weapons in North Korea and Iran, and creating clean and secure energy sources.
But the main focus will be on working towards economic recovery. But the main focus will be the economy.
"The current crisis has made it clear that the choices made within our borders reverberate across the global economy - and this is true not just of New York and Seattle, but Shanghai and Shenzhen as well," President Obama said at the start of the meeting.
"That is why we must remain committed to strong bilateral and multilateral coordination."
Vice Premier Wang also said it was a "critical moment" for the world economy as it moves out of crisis and towards recovery.
Treasury Secretary Timothy Geithner and Secretary of State Hillary Clinton co-host the talks.
Manufacturing competition
At the meeting, the US will push China to rely less on exports and to focus on encouraging its domestic market.
KEY ISSUES Values of dollar and yuanThe US will press China to rely less on exports and more on domestic consumptionChina will push for the US to make a priority of curbing inflationBoth sides will seek reassurances over accusations of trade protectionismNorth Korea and Iran's nuclear programmesClimate change and clean energyKEY ISSUES Values of dollar and yuanThe US will press China to rely less on exports and more on domestic consumptionChina will push for the US to make a priority of curbing inflationBoth sides will seek reassurances over accusations of trade protectionismNorth Korea and Iran's nuclear programmesClimate change and clean energy
US manufacturers complain they cannot compete fairly with their Chinese competitors. "The current crisis has made it clear that the choices made within our borders reverberate across the global economy - and this is true not just of New York and Seattle, but Shanghai and Shenzhen as well," Mr Obama said.
Some accuse Beijing of deliberately devaluing its currency to make its exports seem cheaper. "That is why we must remain committed to strong bilateral and multilateral coordination."
But China is unlikely to concede any ground on this point, says the BBC's Chris Hogg in Shanghai. Mr Wang said the opening up of China's economy could help the US recovery.
GDP growth might be picking up but the country's exporters are still struggling, he says. "With the furthering of China's reform and opening up, China and the United States will have even closer economic cooperation and trade relations and (the) China-US relationship will surely keep moving forward," he said.
'No illusion' But there are areas of contention. The US is expected to push China to rely less on exports and to focus on encouraging its domestic market.
US manufacturers also complain they cannot compete fairly with their Chinese competitors, accusing Beijing of deliberately devaluing its currency to make its exports seem cheaper.
China, meanwhile, is worried about the value of the US dollar. It holds huge amounts of US debt - more than $800bn (£486bn) of US Treasury securities alone.China, meanwhile, is worried about the value of the US dollar. It holds huge amounts of US debt - more than $800bn (£486bn) of US Treasury securities alone.
It fears President Obama's stimulus spending will stoke inflation in the United States, eroding the value of the dollar and making the US debt China holds worth a lot less. It fears Mr Obama's stimulus spending will stoke inflation in the United States, eroding the value of the dollar and making the US debt China holds worth a lot less.
At these talks the US Treasury Secretary Timothy Geithner will be seeking to soothe those fears. Mr Obama said that although the US and China would not agree on everything, he believed the two could make progress on pressing global challenges like trade, emissions and proliferation.
He has already tried to reassure the Chinese their assets will be protected. But China is not convinced. "My confidence is rooted in the fact that the United States and China share mutual interests," he said.
China and the US are well aware they need each other. Their economies are bound together tightly. "If we advance those interests through cooperation, our people will benefit and the world will be better off."
That does not mean they always agree when it comes to trade for example - far from it - but it does mean they accept the need to sort out problems in forums like this. The BBC's Adam Brookes, in Washington, says Mr Obama's speech laid out why it is that America needs China.
"I have no illusion that the US and China will agree on every issue," President Obama said. The degree to which the US president can enlist Beijing's help on global questions will do a great deal to shape the successes and failures of his administration, our correspondent says.
"But that only makes dialogue even more important."