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Commentary: Much can be done by Lew to forge stronger China-U.S. economic ties

English.news.cn   2013-03-19 13:45:53            

by Wu Xia

BEIJING, March 19 (Xinhua) -- U.S. Treasury Secretary Jack Lew is beginning a two-day visit to Beijing Tuesday for his first trip abroad since taking office late February.

He is also the first major foreign visitor that Beijing receives after China completed a once-in-a-decade leadership transition last week.

The extraordinary timing of the visit underscores the importance both China and the United States have put on their economic relationship, a significant part of their overall relations.

The leadership change in both countries opens a window of opportunity for both sides to adjust their economic policies, nurture closer ties, and seek broader common interests.

As newly installed Chinese leaders have promised, Beijing will seek practical cooperation with the United States and build trust based on mutual respect to establish a new type of relationship with the biggest power in the world.

It is hoped Lew will bring similar amity from Washington, and begin a new chapter in ties between the world's first and second largest economies.

Four years after former U.S. Treasury Secretary Timothy Geithner took over the post, the economic challenge Lew inherits is entirely different.

After a sweeping global financial crisis, the United States is facing one fiscal crisis after another.

Investors, both in China and in other parts of the world, hope U.S. lawmakers will strike a timely deal in Congress to avert the potentially devastating default on U.S. government debt or the shutdown of the U.S. Federal government.

The stakes are high. China is the largest overseas holder of the U.S. government debt, and the United States' second largest trade partner.

As a former White House budget director worth his salt, Lew is expected to help Americans fix their budget problems in time and prevent the United States and the world economy from plunging into another catastrophic recession.

China and the United States also share broad interests in business and trade. While Lew is expected to raise the issue of expanding market access for U.S. companies in China, Chinese businesses are waiting for reciprocal hospitality from the U.S. side.

For the past few years, Washington has put up barriers to many Chinese products and investment under the pretext of national security threats or other concerns.

In this globalized world where multinational companies are tapping the comparative advantages of each economy, trade protectionism is counterproductive. Refusing Chinese products makes American lives more expensive, while accepting more Chinese investment means more jobs for the American people.

Like his many predecessors, Lew would probably repeat U.S. concerns to Beijing on the currency issue.

However, recent data have rather taken the wind out of Washington's sails. The U.S. Treasury recently reported that the yuan has risen 16 percent against the U.S. dollar since mid-2010, and witnessed an altogether 31.6 percent appreciation since July 2005, when China embarked on the latest round of currency reforms.

What Lew has to convince his Chinese counterpart is America's commitment to keeping a stable dollar, following aggressive monetary easing measures that have eroded the value of the dollar.

China, a main engine and stabilizer of the world economy, is now focusing on further reforms to build a consumption-led, environmentally-friendly economy.

China's economic transition is a bonus to American businesses, an opportunity the United States cannot afford to miss in order to revive its economy and add jobs.

Lew, fresh in his new role as U.S. Treasury secretary, has much to accomplish during his term of office. It is hoped he would find new ways to build bridges across the Pacific and escort China-U.S. economic ties to prosperity.

Editor: Sha Sha
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