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Last Updated: Thursday, 6 December 2007, 08:50 GMT
US eyes 'balanced' China growth
Henry Paulson
China's growth is good for the world says Paulson
China's growth is in the world's interest but domestic demand, not exports, should drive it, US Treasury Secretary Henry Paulson has said.

Speaking to the Financial Times, Mr Paulson said that people have been wrong to worry that China's growth was going to hurt the rest of the world.

However, he added that the growth needed to become "more balanced".

Critics of China have complained that it keeps its currency weak in order to boost exports and drive the economy.

Beijing talks

Many in the US have bemoaned the weakness of China's yuan, which they say has given the Asian tiger an unfair trade advantage.

Chinese exports to the US and Europe have rocketed in the past year, helped by the weak yuan.

The yuan has appreciated slightly faster in the past year, though not enough to ease concerns.

Mr Paulson is heading to China for talks next week, and trade and currency issues will feature high on the agenda.

Liberalisation of the financial services sector, and the issue of food and product safety are also expected to be discussed at the Beijing talks.

"American consumers need to have confidence in the safety of the products they purchase, whether produced at home or abroad," Mr Paulson said in a speech to the Asia society.

Despite pressure in the US for concrete results from the talks, scepticism remains as to what the talks will actually deliver.

Some observers say that the Chinese administration is weary of America's list of complaints, hopes and requests.

"We see a dialogue fatigue on the Chinese side," said James Zimmerman, president of the American Chamber of Commerce in China.

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