China warns against ‘politicised’ trade ties

China warns against ‘politicised’ trade ties
By Krishna Guha in Washington
Copyright The Financial Times Limited 2007
Published: May 25 2007 01:18 | Last updated: May 25 2007 08:04


China will ”fight to the end” against a case on intellectual property rights brought by the US before the World Trade Organisation, Wu Yi, China’s vice-premier, vowed on Thursday night in Washington.

Ms Wu said the US action ”will surely have serious impact on bilateral IPR co-operation” through the US-China joint commission on commerce and trade (JCCT).

In a robust speech at the end of her trip to the US, Ms Wu also defended China’s decision to open its financial sector at a gradual pace, saying this was essential because its domestic financial institutions were still at a ”relatively low level” of development.

However, she promised to take US President George W. Bush’s request that China lift restrictions on the sale of US beef to Chinese President Hu and ”try to find a solution to the problem”

The vice-premier reiterated the importance of the US-China strategic economic dialogue, while stressing that it should ”bear in mind larger interests and have a long term perspective.”

She said the US and China had complementary economic interests and said ”any effort to politicise economic and trade matters and resort to trade protectionism can do nothing but damage.

Earlier, President Bush pressed Ms Wu on the need for more rapid appreciation of the renminbi at a meeting that followed high-level bilateral economic talks.

Mr Bush said after the meeting that “one of the issues that I emphasised to Madame Wu Yi, as well as the delegation, was that we’re watching very carefully as to whether or not they will appreciate their currency.”

The president said he told Ms Wu that “the $233bn trade deficit must be addressed. And one way to address it is through currency revaluation.”

Mr Bush also backed a push by Hank Paulson, Treasury secretary, to persuade China to open up its financial sector – which achieved only limited results this week.

A Chinese foreign ministry spokesman said her talks with the US president had been “very friendly”.

Zhu Guangyao, China’s assistant finance minister, said it was normal for there to be some bilateral economic disputes, and said China saw the strategic economic dialogue with the US as a way of “gradually solving the problems”.

Chinese companies had entered into contracts worth $32.6bn in a massive procurement and investment mission to 24 states ahead of this week’s strategic economic dialogue in Washington, a move some see as designed to soften opposition among US legislators.

Mr Zhu called on Congress to “bear in mind the overall interests of the US” when considering possible legislation on trade with China.