Learn Chinese - Biz group paves way for Hu

CHINA / National

Biz group paves way for Hu
By Joseph Kahn (The New York Times)
Updated: 2006-04-06 11:50

Chinese leaders, hoping to improve relations with the United States ahead
of the first ever visit there by President Hu Jintao later this month,
have dispatched a large delegation of businessmen and economic officials
both to display China's buying power and to cool protectionist sentiment
in Congress, officials said today.

The buying mission, the largest China has assembled since reestablishing
diplomatic relations with the United States in late 1979, reflects
Beijing's view that it may be easier for it to try to lower economic
tensions than to satisfy some other American demands, such as doing more
to help curtail nuclear programs in Iran and North Korea and reducing
human rights abuses at home.

More than 100 business executives joined Wu Yi, China's vice premier and
economic trouble-shooter, on an American tour that began Tuesday in
Hawaii and is scheduled to cover 13 states.

The trip is expected to result in multibillion-dollar orders for Boeing
aircraft, auto parts, computer software, telecommunications equipment,
grain, cotton and soybeans and other products, officials and state media
reports said.

A senior foreign ministry official described the latest mission as "very
big," and noted that it included representatives from a wide range of
state-owned and private businesses who do not typically travel with
senior Chinese leaders.

"We do want to show the United States that trading ties are mutually
beneficial and we hope people will take notice," said the senior foreign
ministry official, who said he could speak with foreign reporters about
the matter only if he were not identified by name.

"Our message is that common interests are on the increase and the basis
of the bilateral relationship is being constantly strengthened," he said.

Mr. Hu will visit the United States from April 18-22, including his first
trip to the White House since becoming China's Communist Party chief in
2002 and president in 2003. Chinese officials are eager to ensure a
positive reception for Mr. Hu and to demonstrate that he can keep China's
most delicate diplomatic relationship on an even keel.

China last year piled up a $200 billion dollar trade surplus with the
United States, a record trade gap for Washington. The deficit has
triggered Congressional proposals to impose tariffs on Chinese imports
unless Beijing moves faster to raise the value of its currency, the yuan,
which some critics say is kept artificially low, giving China's exports
an unfair edge in international markets.

Bush administration officials have said for months that Chinese leaders
were underestimating the surge of anti-China sentiment in Congress and
among some influential interest groups. They have pressed Beijing to
increase imports from the United States, allow the yuan to appreciate
faster and do more to stop rampant violations of American copyrights and
trademarks by Chinese companies and government entities.

China has ruled out any sudden shifts in its currency policy, insisting
that it will move steadily, but gradually, toward a market-driven
exchange rate.

Officials here have signaled a willingness to do more to protect
intellectual property rights, a perennial sore point with American
companies. They have publicized fines imposed on Chinese companies that
use pirated software. They may also commit to purchases of American
software for government computers.

The biggest action is on the trade front, with China expected to order at
least 80 new Boeing aircraft, mostly single-aisle 737 models, state media
reported. It could also commit to unprecedented purchases of agricultural
commodities and cutting-edge telecom equipment needed to upgrade its
fixed-line and mobile phone networks.

The foreign ministry official said the trade delegation, which also
includes representatives of a dozen government ministries, is hoping to
establish long-term ties with companies in the American heartland to
promote imports in the future.

"We would like to emphasize that this is not a one-off," the official
said.

The effort to ease trade tensions comes despite the fact that Chinese
officials and some independent analysts argue that the current economic
relationship, even with the large bilateral deficit, strongly favors the
United States.

Chinese officials point out that China is now American's fourth largest
export market, with United States exports to China expanding at a 21.5
percent annual pace since 2001.

Officials have also cited academic studies showing that if inexpensive
goods from China were not available, American business and consumers
would have had to pay up to $100 billion more for the same products made
elsewhere. They also say that much of the profit from manufacturing in
China goes to American and other foreign companies and patent holders who
assemble goods and license technology in China.

"The general feeling here is that the trade deficit does not really come
at the U.S. expense," said, an international relations expert at Beijing
University. "The US makes money at every stage of Chinese production."

But, Mr. Jia added, China is eager to help Mr. Bush ease protectionist
pressures in the United States and also create a more positive atmosphere
for discussing more contentious political and diplomatic matters.

"Bush wants to strengthen relations with China but he is politically weak
at the moment," Mr. Jia said. "For political reasons, we feel we need to
help Bush."

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