The third China-U.S. Strategic Economic Dialogue (SED) opens Wednesday, or December 11, through Thursday. Compared with the two preceding SEDs, the present round is of great importance as it has a function of serving a link between past and future. If the Chinese and American sides are able to reach consensus on some major issues, it will help enhance the SED basis for a long period of time to come and enable such a basis to stand a possible political repercussion resultant from the incoming presidential campaign next year and the change of government in 2009.
The China-US SED represents the biggest regular dialogue mechanism at the highest level and covers the most extensive realm. In the last two dialogues, the two nations attained some basic consensus through an in-depth exchange of views on the basic character, structural contradictions and constructive, cooperative Sino-US economic ties.
For instance, both sides took the international division of labor as the leading root cause to a huge trade surplus in Sino-US trade and both sides acknowledged that the vital ways for settling the trade surpluses lies in readjusting industrial structure and extending the domestic demand, and that proactive and reliable principles have to be followed. Moreover, progress has been scored in bilateral cooperation in some specific fields. China and the U.S. came to six consensuses, including those to open the New York Stock Exchange's representative office in Beijing and boost US exports to China in the first SED and, during the second SED, both sides agreed to double the number of flights between China and the U.S. in 2012. Furthermore, China agrees to go on opening its banking sector and sign bilateral agreements or memoranda on energy, the aged pensions and unemployment insurance.
The mutual trust, mutual understanding and specific outcome attained in the two previous SEDs constitute a sound basis for the ongoing strategic dialogue, and also forebode a new height for the current SED. From the strategic aspect, there is a hope to further reinforce Sino-U.S. strategic mutual trust. This is the third China trip made by U.S. Treasury Secretary Henry Paulson as well as his fifth visit to China since he assumed office.
Only with a growing, in-depth understanding of each other's economic set-ups, economic systems, political decision-making and complexity of bilateral economic and trade ties, can both sides come to recognize that contradictions should be resolved via long-term meticulous cooperation.
From the tactical aspect, with consensuses reached to some extent in many rounds of talks in such fields as product safety, energy cooperation and environment protection over the last few months, they are hoped to be implemented in the current SED.
Mike Leavitt, U.S. the Secretary of Health and Human Services, said on Dec. 3rd that China and the U.S. could sign two letters of memorandum on product safety to ensure that Chinese export commodities could comply with the American safety criteria. It can also be said that the current SED could materialize its set goal since both China and the U.S. are able to achieve a breakthrough in both the strategic and tactical aspects.
The attainment of the objective, however, requires concerted efforts of both sides. The sub-prime loan or mortgage crisis, erupted in August this year, has sustained and inflicted heavy casualties on the US financial and banking sector, so U.S. economy inclines to turn dim or faint with bleak prospects. The overall situation, nevertheless, is not bad at all in term of bilateral economic and trade relations, and this poses a sound opportunity for the two sides to reach overall, wide-ranging consensuses. With the seizure of this rare opportunity, the risk-reduction capacity of both nations will beef up.
With regard to the U.S.' internal affairs, Paulson and his peers would of course very much hope to achieve results in a bid to retain the present SED mechanism. Both chambers of house in the United States set forth a couple of motions to impose punitive measures against China when Sino-US economic relations were relatively strained a year ago.
After taking his office, Paulson lobbied hard among Congressmen in a hope that Capitol could retain certain patience and give him some time and let him help settle some major issues existent in Sino-US economic and trade relations. Under such circumstances, Paulson has to convince Capitol with specific outcome to spur the SED and to carry it forward.
By People's Daily Online and its author is Niu Xinchun, a research fellow with the Institute of American Studies affiliated to the China Institutes of Contemporary International Relations.
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