China-U.S. Talks Hit on Rights and Trade ~ Jakarta Forum

(JakartaForum-NYTimes) WASHINGTON — Two days of high-level talks between the United States and China wrapped up Tuesday with both sides hailing modest progress on economic issues even as they traded harsh words about China’s respect for human rights.

The grand scope and pomp of the talks, which have become an annual event involving hundreds of politicians, bureaucrats, generals and business executives from each country, stood in striking contrast to the limited results, which included a Chinese promise to prevent government agencies from using pirated software.

But both sides insisted in closing speeches Tuesday that meeting and talking in themselves was sufficient achievement, because they may well lay the groundwork for grander bargains.

“As we say in China, spiritual things can be turned into material ones,” said Cui Tiankai, vice minister of foreign affairs, describing the value of improved relations.

The meetings, which began in 2006 as focused solely on economic issues, have expanded steadily to encompass the full range of the relationship between the countries, including talks between military leaders for the first time this year.

The issue of human rights shadowed the meetings. Chastising the Chinese is a political necessity for American officials, but both Hillary Rodham Clinton, the secretary of state, and Vice President Joseph R. Biden Jr. carefully measured their criticism in public remarks on Monday.

Then, in an interview published Tuesday on The Atlantic’s Web site, Mrs. Clinton went much farther, calling China’s record on human rights “deplorable” and suggesting that a popular demand for democracy eventually would unseat China’s rulers, just as it has undermined several governments in the Middle East and North Africa.

“They’re worried, and they are trying to stop history, which is a fool’s errand,” she told the magazine, speaking of the Chinese government’s crackdown in response to the democracy demonstrations in the Arab world. “They cannot do it. But they’re going to hold it off as long as possible.”

Asked about the issue later on Tuesday in the presence of Chinese officials, Mrs. Clinton was again more measured, saying that every nation was different but that she had discussed with the Chinese the events in the Middle East and North Africa.

Mr. Cui responded on Tuesday, telling reporters that the reason other countries raise the issue of human rights in China “is probably that they are trying to make some political gains and hoping that this can draw attention from the press.

“Human rights in China has made historic progress in the last few decades,” Mr. Cui said. He added that every country, included the United States, needed to keep making progress.

Meanwhile the two countries continue to deepen their economic ties.

The Bush administration initiated these meetings, recognizing that the Chinese wanted the United States to demonstrate greater respect for their emerging power and hoping to break longstanding deadlocks on significant issues.

The focus initially was almost entirely on America’s lopsided trade relationship with China, which sends much of its goods to the United States and buys relatively little in return. American officials contend that China suppresses the value of its currency to help preserve this imbalance, and the United States has pressed China for years to let the currency rise in value.

But those issues have somewhat receded in importance lately as China has allowed its currency to rise against the dollar by about 10 percent, including inflation. American exports to China also have grown rapidly.

“We are seeing very promising shifts in the direction of Chinese economic policy,” Treasury Secretary Timothy F. Geithner said Tuesday.

Just before the second day of talks, which focused on the balance of trade between the countries, China published monthly data showing its exports exceeded imports by $11.43 billion in April, a sharp increase from the first three months of the year. A senior Treasury official said policy makers did not focus on monthly fluctuations, however, and continued to see a positive trend in the balance of trade.

American officials also hailed progress on a number of smaller issues.

The Chinese government agreed, for example, to make it easier for foreign companies to win government contracts by eliminating a system of preferences for products listed in special directories — generally those made by Chinese companies.

John Frisbie, president of the US-China Business Council, which represents the interests of American companies in China, said 25 percent of the group’s member companies had lost government contracts in the last year because of the policy.

“I think the dialogue showed again why engagement with China mattered, because there were results that were important for U.S. companies,” Mr. Frisbie said.

American officials also pressed China to adopt financial reforms aimed at increasing domestic consumption as an alternative to economic growth fueled by exports. Here, too, the two sides reported small steps, including a pledge “to advance toward allowing” foreign companies to sell auto insurance in China, which is now the world’s largest market.