China warns U.S. as joint trade talks begin

WASHINGTON - The United States and China opened a round of high-level economic talks yesterday, with the leader of the Chinese delegation bluntly saying that any effort to politicize economic differences between the two nations was not acceptable.

The Bush administration was pushing for concrete results to show to an increasingly restive Congress. Lawmakers attribute soaring U.S. trade deficits and the loss of one in six manufacturing jobs since 2000 in part to China's trade practices in such areas as currency manipulation and copyright piracy.

The U.S. delegation to the Strategic Economic Dialogue also raised the issue of food safety, highlighted by such incidents as the deaths of pets that had eaten pet food made with tainted wheat gluten imported from China.

U.S. Trade Representative Susan Schwab, who briefed reporters on the discussions, said food safety was brought up by Agriculture Secretary Mike Johanns and Health and Human Services Secretary Michael Leavitt.

"They know this is an issue that concerns us and concerns the American people," Commerce Secretary Carlos Gutierrez said. At the briefing, he said the issue would be addressed more formally before the two-day talks concluded today.

In opening remarks delivered in an ornate government auditorium decked out in flags from both nations, Chinese Vice Premier Wu Yi cautioned the United States against pursuing a blame-game.

"We should not easily blame the other side for our own domestic problems," Wu said, speaking through an interpreter. "Confrontation does no good at all to problem-solving."

Wu, who gained a reputation for tough speaking when she was China's top trade negotiator, said both sides should "firmly oppose trade protectionism." She said any effort to "politicize" the economic relationship between the two nations would be "absolutely unacceptable."

Wu and her delegation were to meet behind closed doors tomorrow with key leaders of Congress. Lawmakers are pushing a variety of bills that would impose economic sanctions on the Chinese; the U.S. trade deficit with China hit $232.5 billion last year, accounting for almost one-third of the nation's record total deficit of $765.3 billion.

Treasury Secretary Henry Paulson created the Strategic Economic Dialogue last year as a way to get the two countries' top policy makers together twice a year to try to ease trade tensions. The first meeting was held in Beijing in December.

Breakthroughs at this meeting were expected in the area of cutting tariffs on sales of U.S. energy-technology products and services in China and increasing U.S. passenger and cargo flights to China.

However, success in another area - getting China to boost the stake that U.S. firms can own in Chinese financial-services companies - seemed less certain. The current cap on foreign ownership of Chinese banks is 25 percent.

U.S. officials tamped down expectations of any big breakthroughs, saying the meetings were not meant to be negotiating sessions.

Gutierrez said there was impatience on the U.S. side. He spoke of the "need to make progress in all areas as soon as possible."