ANNAPOLIS, Maryland, June 18 (AFP): The United States pressed China yesterday to advance market-opening measures but faced criticism over its weakening dollar as the two nations opened talks to address economic issues.
At the start of discussions in Annapolis, Maryland, east of the US capital, US Treasury Secretary Henry Paulson said economic difficulties facing both China and the United States should not lead to trade and investment restrictions.
"As we manage through the current challenges, we must also focus on the long-term fundamentals that underlie sustainable growth in both our nations," said Paulson, who led the US side to the two-day cabinet-level "strategic economic dialogue" (SED) at the US Naval Academy.
"Openness and trade create jobs and opportunities for people to rise out of poverty, and are necessary for economic growth and stability-in both China and in the United States," he said, with Chinese Vice-Premier Wang Qishan by his side and cabinet ministers from the two nations standing behind them.
Wang, who led the Beijing team to the dialogue, warned against politicising economic issues and moved to deflect any criticism by highlighting the US housing market crisis that has led to massive losses in the finance sector and a global credit crunch.
"In an effort to solve the frictions and differences between the two countries through dialogue and in order to reduce misunderstandings, we should try to avoid major economic issues from being complicated and politicised," said Wang, making his maiden appearance at the twice-yearly SED launched in 2006.
But China's central bank governor Zhou Xiao Chuan was more critical, saying the falling US dollar was driving up oil and other commodity prices, stoking inflation and causing pain to developing nations.
Speaking after meeting US Federal Reserve chairman Ben Bernanke and Treasury chief Henry Paulson at a session on "managing financial and macroeconomic cycles," Zhou said rocketing commodity prices were putting undue "pressure" on the Chinese currency and driving up inflation in China.
