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China, US strike 67 agreements during high-level talks

May 05, 2012 14:40 IST

Notwithstanding the row over a blind Chinese dissident, China and the US have struck 67 agreements during their crucial economic dialogue covering a wide range of issues relating to trade and investment.

The two sides gained "significant" results out of the dialogue attended by US Secretary of State Hillary Clinton and Treasury Secretary Timothey Geithner, the state-run media in Beijing reported on Saturday.

While China has vowed to open up its financial market more to foreign investors, the US will quicken its examination and approval for Chinese financial institutions that apply to invest in America, China Daily said.

During the course of the two dialogue which ended Friday, both sides sorted out the row over blind Chinese dissident Chen Guangcheng, who had sought refuge in America, with Beijing agreeing to let him leave the country and Washington assuring him all assistance to get asylum.

The US has also agreed to provide him a fellowship to study in American University.

Both delegations said they were deeply encouraged by the results of their dialogue, while President Hu Jintao said there have been "significant agreements" in this round of talks.

The two countries reached 67 agreements in the economic dialogue, covering a wide range of issues in the macro economy, bilateral trade and investment as well as financial cooperation, the China Daily said.

"There is significant progress in financial cooperation between the US and China," according to Chinese Vice Minister of Finance Zhu Guangyao.

Zhu said the US is now quickening its examination and approval process on the Bank of China and Agricultural Bank of China's applications for opening more branches in the US and the Industrial and Commercial Bank of China's initiative to take over Bank of East Asia (US).

In 2010, the Industrial and Commercial Bank of China, the world's largest lender by market value, completed the acquisition of a 70-per cent stake of Bank of East Asia Canada to expand its business in North America.

China will revise regulations to allow foreign investors to raise their stakes in joint venture securities companies and joint venture futures companies to as much as 49 per cent. Foreign investors' ownership in securities firms is capped at 33 per cent.

"This is a signal from China's policymakers to further open financial markets," said Sun Zhe, a professor at Tsinghua University's department of international relations.

"But the two countries should further quicken the process of promoting bilateral trade and investment," he told the Daily.

China has made significant and promising reforms to its currency regime that will lead to further appreciation of the yuan against the dollar and other major currencies over time, US Treasury Secretary Timothy Geithner said Friday.

"China has acted to move toward a more flexible exchange rate system in which the market plays a greater role. It is intervening less in exchange markets.

"China is also moving to liberalise controls on the international use of its currency and on capital movements into and out of the country," the daily quoted Geithner as saying during the talks.

Moreover, the US said it is committed to loosening restrictions on high-tech exports to China soon.

According to Yukon Huang, a senior associate at the Carnegie Endowment for International Peace and the former World Bank country director for China, the US restrictions on high-tech exports to China are extremely rigid.

"It doesn't make much sense from a national security point of view as China can easily get them from somewhere else," Huang said.

Besides trade, the two sides discussed key international issues.

US Secretary of State Clinton said that they discussed hot spot issues ranging from the Democratic People's Republic of Korea and Iran to Sudan and Syria.

Every problem has provided an opportunity for cooperation, she said.

Clinton said she expected the mechanism started in 2009 only to be consolidated in the future.

State Councillor Dai Bingguo, who led the Chinese delegation, called the talks a "tremendous" success.

He said the small-scale strategic talks, which usually touch upon sensitive issues, were the most time-consuming of all dialogue in this round.

"It took a whole day yesterday" he said, adding both sides have been more candid than before and have become accustomed to in-depth talks with each other.

Dai also noted that human rights should not be used to "interfere in other countries' internal affairs" and that no country could claim to be perfect in that regard.

According to the Foreign Ministry, among dozens of achievements on the strategic channel, the two sides decided to hold another round of consultation on Asia-Pacific affairs later this year, and a human rights dialogue in Washington in the summer.

A meeting on Middle East affairs was also put on the agenda.

In addition, both sides are considering sending a Chinese maritime security ship to Hawaii in September for a joint drill with a US Coast Guard ship.

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