China and US wrap up 'productive' high-level talks

China and the United States wrapped up two days of high-level talks on Tuesday. US Secretary of State Hillary Clinton described the discussions as "very productive", even though they failed to resolve the two countries' trade and currency disputes.

Reuters

Secretary of State Clinton and Treasury Secretary Timothy Geithner led a 200-strong delegation to Beijing for the annual US-Chinese Strategic and Economic Dialogue meeting.

While the trip provided an opportunity to discuss the trade and currency issues that have divided China and the US in recent months, controversy surrounding the sinking of a South Korean warship brought foreign policy questions to the fore.

Washington was quick to back South Korea's sanctions against the North, but Beijing has so far refused to condemn Pyongyang over the incident.

China and the US have nonetheless agreed to work together on "an effective and appropriate response" to the crisis, Clinton said from Beijing.

Both countries agree that ensuring peace in the Korean peninsula is "critical", added Chinese State Councillor Dai Bingguo at a joint press conference with US officials.

"Relevant parties should proceed on the basis of safeguarding the overall interest of peace and stability in the region, and calmly and appropriately handle the issue to avoid escalation of the situation."

The two sides were less united on economic issues, however.

While reforming China's exchange-rate policy to prevent Beijing setting the yuan's value artificially low was an "important focus" of this week's talks, "intensive discussions" on the issue will continue ahead of the next G20 summit in June, the US Treasury said in a statement on Tuesday.

Chinese President Hu Jintao pledged on Monday to make "gradual progress" on currency policy, but stressed that any reforms would be carried out at China's own pace.

The Chinese side meanwhile pressed Washington to lift restrictions on exports of US technology to China.

The US will complete a review its export controls by mid-year, responded US Commerce Secretary Gary Locke, but declined to specify which curbs could be relaxed with respect to China.

Washington is unlikely to relax its restrictions on its most sensitive technology exports, only some less strategic items, according to Professor Yixin Chen, a lawyer in Taiwan.

"I don't think China will be happy with the US move," Yixin told RFI.

He says economic issues were overshadowed by strategic ones at this year's talks: "This time the US and China can hardly solve any problems in any meaningful way."