From Overseas Press

US unlikely to push China hard on currency issue

(Agencies)
Updated: 2010-05-20 09:56

EUROPEAN CRISIS A WORRY

A Chinese Ministry of Commerce report issued on Wednesday said the yuan has risen nearly 14.5 percent against the euro so far this year and predicted it will hurt exports this year.

Loevinger linked Beijing's stated concern about the size of US budget deficits with the US call for China to boost consumer spending at home rather than relying on exporting its way to wealth.

"The administration is very committed, once the recovery is fully assured, to bringing the fiscal deficit down to a sustainable level," he said, which may pinch Americans' ability to be the world's most voracious buyers.

"The implication for China is that the US consumer is going to play a different role in this recovery ... and it's more important than ever that China accelerate its efforts to accelerate home-grown consumption-based growth," he said.

Loevinger said the US was concerned about Chinese industrial policies that some say favor China's companies over foreign competitors and interfere with trade.

"We have no problem with China promoting innovation...but we want to make sure that they do it in a way that doesn't close off markets for US goods and services," he said.

Geithner and Secretary of State Hillary Clinton will lead a delegation of about 200 US officials to the Beijing talks for the second round of meetings since the Obama administration took office.

The diplomatic side of the talks will cover a range of sensitive issues from cooperation on efforts to curb Iran's nuclear ambitions to what measures countries can agree on to reduce pollution and deal with climate change.

The first meeting in Washington last summer made little impact, but US officials appear to be aiming for a more significant outcome. Geithner arrives in Beijing on Sunday and will hold a working lunch with Zhou Xiaochuan. China's central bank governor, and a working dinner with Vice Premier Wang Qishan ahead of the May 24-25 sessions.