New deputy to oversee Sino-US strategic talks

US Treasury Secretary Henry Paulson has appointed a new deputy to oversee strategic talks with China and will set up a telephone hot line between himself and Vice-Premier Wu Yi.

His announcements were made on Tuesday when the United States reported a record trade deficit of $232.5 billion with China last year. The figure from the Chinese customs was $144.27 billion.

Alan Holmer, an executive of a pharmaceutical company and a former trade official in the Reagan administration, was named Paulson's deputy.

Beijing and Washington are scheduled to hold the second round of a strategic dialogue in May. The first round was held in Beijing in December.

Paulson told reporters it was too early to predict the results of the May meeting in Washington, but he said he understood the pressure from the US Congress to get results.

Experts in Beijing said the United States is not justified in blaming China for the widening trade gap.

According to customs statistics, China has become the fastest growing export market of the United States. China now purchases about a quarter of US cotton exports and one third of its soybean exports. China also signed contracts for 80 Boeing aircraft last year, valued at $6 billion.

In the latest sign of easing trade relations, US President George W. Bush reportedly paved the way for technology exports from Honeywell International Inc and Boeing Co to China, certifying the exports "will not measurably improve the missile or space launch capabilities of the People's Republic of China".

The certification issued early this week was for 20 Honeywell model QA 750 accelerometers to be incorporated into railway geometry measurement systems for the Ministry of Railways, and equipment and technology associated with the production and testing of composite components for Boeing commercial aircraft.

Both companies were not available for comment. But the move is expected to help, to some extent, boost US high-tech exports to China, which is seen as a major reason for the trade imbalance.

China, the fastest growing economy in the world, needs high-tech products but the United States has insisted on strict export control policies.

From 2001 to 2005, China's high-tech imports from the European Union and Japan increased 71 percent and 151 percent, but imports from the United States grew only 38 percent.

Source: China Daily