- Associated Press - Friday, October 8, 2010

WASHINGTON (AP) — President Obama called on China Friday to quickly release imprisoned Nobel Peace Prize laureate Liu Xiaobo, lauding the dissident as an “eloquent and courageous” supporter of human rights and democracy.

The comments are likely to further rattle China at a time when the United States is stepping up pressure on Beijing over a currency policy Washington blames for job losses.

Mr. Obama’s statement, released hours after Mr. Liu was awarded the prize, reflected the sensitivity of U.S.-Chinese relations.

Mr. Obama praised China’s “dramatic progress in economic reform and improving the lives of its people, lifting hundreds of millions out of poverty.” But, he added, “this award reminds us that political reform has not kept pace, and that the basic human rights of every man, woman and child must be respected.”

U.S. officials try to strike a balance with China, pressing it on economic and human rights issues, while trying to win crucial Chinese support on the Iranian and North Korean nuclear standoffs, climate change and other difficult issues.

Mr. Obama, in his statement, also brought up his own Nobel Peace award last year, repeating his belief that other laureates had done more. “That list now includes Mr. Liu, who has sacrificed his freedom for his beliefs,” Mr. Obama said.

There was no immediate reaction from Beijing on Mr. Obama’s warm words for Mr. Liu, who was sentenced last year to 11 years in prison on subversion charges after he co-authored a document calling for greater freedom, among other activism.

The award, however, has infuriated Chinese officials. Beijing quickly warned that the decision would harm relations with Norway, which is the home of the independent peace prize committee.

A recent U.S.-China agreement to end an eight-month freeze on military exchanges led to cautious hope that U.S. ties were improving with China, the world’s No. 2 economy.

But Mr. Liu’s prize and rising U.S.-China economic friction this week complicates the Obama administration’s efforts to win Chinese trust and cooperation. The award is also set against the backdrop of harsh criticism of China by U.S. lawmakers faced with make-or-break congressional elections next month. Many lawmakers maintain that Beijing’s currency policies are responsible for the loss of thousands of American jobs.

U.S. critics contend that the Chinese yuan is undervalued by as much as 40 percent, giving Chinese companies a significant competitive advantage over American businesses.

Ahead of this week’s global financial meetings in Washington, Treasury Secretary Timothy Geithner ratcheted up pressure on China to make more progress in moving toward flexible exchange rates.