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'China committed to yuan reform'

(AP/China Daily)
Updated: 2007-08-02 08:41

China revalued the yuan by 2.1 percent against the dollar in July 2005 and has allowed it to rise by about 7.2 percent since then. The rate of increase has speeded up in recent months, but analysts expect Beijing to restrain the yuan's rise to about 5 percent annually over the next few years -- far less than critics want.

The Senate is considering two bills aimed at pressuring China to overhaul its currency system.

Paulson rejected such measures, saying they would harm Washington's efforts to encourage Beijing to reform.

"Legislation would be counterproductive and would undermine what we're trying to do here," Paulson said.

Paulson has pleaded with Congress for time to let the dialogue work. But China's supercharged growth is fueling arguments that it can afford to move faster.

China's economy expanded 11.9 percent last quarter -- the fastest quarterly growth in 12 years -- and the trade surplus jumped by 85 percent in June to $26.9 billion.

Hu stresses value of Sino-US dialogue

President Hu Jintao reiterated the importance of maintaining stable and mutually beneficial Sino-US economic relations when meeting with Paulson.

He urged the two sides to make full use of the strategic economic dialogue (SED) to address issues of common concern.

Hu said the development of bilateral economic ties have not only brought tangible benefits to the people of both countries but have also been engines of global growth.

Calling Paulson an old friend of China, Hu said the two sides should ensure that the SED is coordinated well with other Sino-US negotiation mechanisms to promote cooperation.

He also urged both countries to fully implement the follow-up actions of the SED to further enhance strategic mutual trust and deal with issues of mutual concern.

Paulson hailed the SED as helpful to enhance bilateral economic relationship; and said he will work with Wu to make the dialogue a forum to ease friction and resolve disputes.

He added that the US is looking forward to strengthening cooperation with China in the fields of energy, environmental protection, food safety and finance.

Paulson joined other top Bush aides in a letter on Tuesday to congressional leaders to head off several trade-focused bills that are aimed at pressuring China to revalue the currency to ease the trade imbalance.

The letter was released after Paulson met Wu on Tuesday.

Paulson told reporters late Tuesday night that he warned against sanctioning Beijing over trade disputes and called for more dialogue.

Paulson held another private meeting with Wu last night before leaving Beijing for home.


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