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Last Updated: Tuesday, 11 December 2007, 15:56 GMT
US and China in clash over trade
A bank worker counts Chinese yuan
Some in Washington are calling for the yuan to be strengthened
China has accused the US of protectionism as talks on trade and currency issues start in Beijing.

China's product safety record, its massive trade surplus and what some in Washington see as Beijing's currency manipulation are high on the agenda.

About 14 agreements were sealed on Tuesday, aimed at broader market access, boosting tourism and investment as well as better product checks.

But the atmosphere turned frosty as China accused the US of protectionism.

It also said that product safety concerns had been "hyped" by the media.

Broad-ranging talks

There have been some disharmonious notes in China-US relations this year
Chinese Vice Premier Wu Yi

US Trade Representative Susan Schwab and US Commerce Secretary Carlos Gutierrez took part in trade talks on Tuesday, while US Treasury Secretary Hank Paulson will join them on Wednesday and Thursday for a "strategic economic dialogue" which will focus on currency issues.

Some members of the US Congress want forceful action against China and its soaring trade surplus, which they blame on the country's weak currency that makes its exports relatively cheap.

China's trade surplus reached a near-record high in November and its US surplus is also heading for a new record.

But in China, officials are tired of what they see as a litany of complaints from a protectionist US, and sceptics question what the three-day meeting will really achieve.

Growing protectionism?

As the talks began, China's Vice Premier Wu Yi warned over growing protectionism in the US.

America and China must work together to stem the tide of protectionist sentiment in our nations
Carlos Gutierrez, US Commerce Secretary

"There have been some disharmonious notes in China-US relations this year. The inclination to politicise (trade) issues has increased," she said.

"Trade restrictions, and protectionist measures, can only hurt both sides."

Meanwhile, US Commerce Secretary Carlos Gutierrez acknowledged that there were protectionist sentiments held by some in both China and the US.

"We have to continue opening global markets. America and China must work together to stem the tide of protectionist sentiment in our nations," he said.

"It is ironic that we have found that protectionism does not protect. The only thing that does protect is innovation and engaging with the world, competing, being more productive."

Product safety

Scandals over problems with products made in China - from toys to food - mean that safety of goods will be high on the agenda of the talks.

"How they (China) deal with these issues they've had with product safety is very important," Mr Gutierrez said.

"I would have to assume that the brand 'China' is very important to the Chinese."

However, Wu Yi said that the US media exaggerated Chinese quality problems.

"The US media hyped about the quality of Chinese exports, causing serious damage to China's national image," she said.

Last month, trade talks between China and the EU again raised concerns that China did not protect the intellectual property rights of European companies.

There was also concern about the vast trade surplus between the 27-nation block and China.

SEE ALSO
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08 Sep 06 |  Business
China set to be largest economy
22 May 06 |  Business
What is America's China problem?
20 Apr 06 |  Business

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