The Sino-U.S. two-day Strategic and Economic Dialogue held in Shanghai this month have come to a close, bringing some accord to contentious issues, such as currency and trade, but demonstrating a change in the relationship between Washington and rising power Beijing. China is the largest foreign owner of U.S. Treasury Securities, and is listed by the U.S. Treasury as holding 23.4 percent ($877.5 billion), so the economic direction of the two countries is intricately connected. The United States praised the outcome of this week's dialogues.
China-U.S. relations have been called the most important bilateral relationship in the world. Because of this, the Obama administration has held out hopes that a partnership could blossom with the potential to address key global issues, including climate change and world economy. Progress has been slow, but many are pleased that at least progress is being made
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One topic that was discussed was Beijing's promotion of "indigenous innovation" which has been labeled by some foreign companies as a protectionist strategy. China repeated its hope for a resolution within the World Trade Organization (WTO). "This is progress," U.S. Treasury Secretary Timothy Geithner said about China's response. policies that threaten to exclude foreign companies from a government-procurement market worth billions of dollars each year. "It does not fully resolve our concerns, but it gives us a set of basic principles on which to move forward," he told a closing ceremony at the Great Hall of the People. Americans are still uneasy because of policies that would exclude foreign companies from a Chinese market worth billions of dollars annually.
As a result of the meetings, China pledged to gradually reform its currency-exchange rate, but declined to specify on a timescale what they meant by "gradually." U.S. lawmakers are giving the issue some space due to the sovereign-debt crisis rocking Europe and the fall in the value of the euro, both of which have damaged Chinese exports. However, claims that China is intentionally weakening its currency to benefit exporters were unpacified by obscure promises from Beijing, and are likely to push for China to be formally declared a currency manipulator if action isn't imminent.
The U.S. government is pursuing a more diplomatic route, offering China latitude to set its own schedule, in order to keep the Chinese from entrenching which could happen if they felt bullied by the U.S.
The U.S. and China both have interests in the burgeoning crisis between North and South Korea, stemming from allegations that the North torpedoed a Southern patrol vessel. Chinese State Councilor Dai Bingguo coolly offered, "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 and avoid escalation of the situation." However Vice Foreign Minister Cui Tiankai promised to "work together with the U.S. and other parties and continue to stay in close touch on the situation in the Korean peninsula."
The U.S. has recently angered China because of arms sales to Taiwan, considered by China to be a renegade province. Feathers were also ruffled by President Obama's meeting with the Dalai Lama, a Tibetan spiritual leader accused of agitating for independence in China's Himalayan region.
U.S. Secretary of State Hillary Clinton spoke of navigating our differences. "In an earlier era we might have experienced a lasting setback," she said. "This dialogue?helped put us rapidly back on a positive track." Chinese Vice Premier Wang Qishan echoed her sentiments saying, "We are now able to manage the differences and problems arising in the course of our relationship in a more rational and mature manner."