US, China Pledge Closer Cooperation on Global Economy

Posted January 11th, 2012 at 1:55 am (UTC-5)
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China and the U.S. have agreed to increase their cooperation in boosting the global economic recovery, as U.S. Treasury Secretary Timothy Geithner continues his two-day diplomatic tour in Beijing on Wednesday.

Geithner held talks Wednesday with Chinese Vice President Xi Jinping, who is expected to soon be confirmed as China’s next leader. Xi said Geithner’s visit will help improve U.S.-China trade relations.

“I think your visit will greatly promote the bilateral relationship between China and the U.S. and our economic ties in 2012.”

China’s state-run Xinhua newspaper said the two sides pledged cooperation Tuesday on speeding up the recovery of the “very complex and grim” world economic situation.

Geithner is expected to use his Wednesday talks with Premier Wen Jiabao and Vice Premier Li Keqiang to push for Chinese cooperation on U.S. sanctions against Iran’s oil industry.

But progress on the issue seems unlikely, as China buys almost one-third of Iran’s oil exports and has repeatedly opposed sanctions as a tool to rein in Iran’s nuclear program.

U.S. legislation passed on the final day of 2011 aims to reduce Iran’s oil revenue by imposing sanctions against those who do business with Iran’s Central Bank. Washington hope the measures will convince Tehran to abandon its nuclear development program. Many Western nations suspect that Iran is pursuing nuclear weapons – a charge that Tehran denies.

Although China did not veto U.N. sanctions against Iran’s nuclear program, it opposes the much harsher U.S. measures, saying they are “unilateral” and could lead lead to war.

U.S. Treasury officials say Geithner also will bring up proposals they say would “level the playing field for U.S. workers and firms.”

Washington has long contended that China’s currency, the yuan, is substantially undervalued. The U.S. says that gives Chinese exporters an unfair advantage and has led to a wide U.S. trade deficit with China.

Geithner will leave later Wednesday for Japan, another major buyer of Iranian oil.