Geithner calls for closer China ties
He said he seeks the kind of relationship the U.S. has long had with Europe.
BEIJING - After years of acrimonious economic relations with China, the United States insists it wants to turn the page and develop closer ties with the world's third-largest economy.
Treasury Secretary Timothy Geithner, who arrived yesterday in Beijing for two days of talks with Chinese leaders, said he wanted to foster the same kind of working relationship with China that the United States has enjoyed for decades with European economic powers.
On his first visit to China as treasury secretary, Geithner said the Obama administration was committed to forging a new relationship with China after trade disputes with the United States over the last decade.
Those fights have reflected record U.S. trade deficits with China. U.S. critics of China's economic policies say they have contributed to the loss of millions of American manufacturing jobs.
But China is America's biggest creditor, holding $768 billion in Treasury securities. The United States also hopes China will play a positive role in resolving a tense dispute with North Korea over its nuclear weapons program.
Geithner said China's status should be recognized with a bigger voice in such institutions as the International Monetary Fund.
Geithner said that the U.S. economy, mired in its longest recession since World War II, was beginning to stabilize. "We are seeing more durable stability in the economy and the financial system is in substantially better shape," Geithner said.
But he said much more needed to be done in the Unnited States and in other major economies to make a sustainable recovery possible.
Geithner planned a speech today at Beijing University assessing the global economy and U.S.-China relations. He spent two summers at the university as a college student learning Mandarin Chinese.
At a briefing previewing the trip for Asian journalists, Geithner referenced those ties, saying he had taught Chinese while in college and had a "long personal interest" in the country. But he insisted that while he had worked very hard at his Chinese language studies, he was not proficient.
"I cannot actually speak Chinese with competence," he said. "I did study though for a long time, very hard. I practiced my characters very carefully."
The Obama administration and China have come out with two massive economic stimulus plans while European countries have resisted President Obama's calls to do more. They say they do not want to face the same deficit problems that the United States has.
China has turned its huge trade surpluses with the United States into the largest holdings of Treasury debt, but has raised concerns about America's commitment to deficit reform. Financial markets in recent weeks have sent long-term interest rates higher, a move that some attribute to worries about the U.S. budget deficits.
The administration projects that the deficit for this year will hit $1.84 trillion, a record and four times higher than the previous mark set last year.
Geithner said that the administration had a credible program to reduce the deficits once the economy begins to recover. "No one is going to be more concerned about future deficits than we are," he told reporters.