- The Washington Times - Wednesday, April 12, 2006

President Bush, set to meet next week with Chinese President Hu Jintao at the White House, yesterday urged the communist nation to explain how it plans to help correct global trade imbalances.

The pressure from the White House came a day after China pledged to lift its ban on American beef, to crack down on the sale of pirated computer software and to consider allowing foreign firms to compete for Chinese government contracts during negotiations between top economic officials from both countries.

Mr. Bush met yesterday with a Chinese vice prime minister, Wu Yi, on U.S.-Chinese trade issues. She assured the president that China soon plans to reopen its market to U.S. beef imports, White House spokesman Scott McClellan said.

“The president told Madame Wu Yi that he looks forward to the visit of President Hu Jintao to the White House next week and said it is important that President Hu explain to the American people how China will meet the challenge of rectifying global economic imbalances,” Mr. McClellan said.

American companies are hopeful that China will announce before Mr. Hu’s trip to Washington that it is prepared to move more quickly to a fully flexible exchange rate. They contend that China’s yuan is undervalued by as much as 40 percent, giving China an unfair advantage that contributes to a massive U.S. trade deficit with China.

Although China has allowed the value of the yuan to rise by a little more than 3 percent in the past year, U.S. companies contend the Chinese are going far too slowly in dealing with what could make a big difference in narrowing the trade gap.

Mr. Bush, citing America’s $202 billion deficit with China, said Monday that he was hopeful that Mr. Hu would address the currency issue during his visit.

“He’s coming into a country where there’s over a $200 billion trade deficit [with China], and a lot of Americans are wondering where’s the equity in trade,” the president said at the Paul H. Nitze School of Advanced International Studies at Johns Hopkins University.

“I think he could help the Americans understand the importance of a free trading world if he were to maybe make a statement on his currency, for example,” he said.

In trade talks on Tuesday, Miss Wu said her country has been “earnestly implementing” the directions of China’s top leaders to boost imports from the United States.

China agreed to move to lift the beef ban it imposed after the first case of mad cow disease was discovered in the United States in December 2003 but said it would do so only after certain technical issues were resolved.

On copyright piracy, China agreed to require that all computers sold in the country be loaded with legal operating software and to increase enforcement efforts against all forms of copyright piracy.

“It’s progress and … now we will look forward to seeing results,” Mr. McClellan said.

• This story is based in part on wire service dispatches.



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