Obama will push economic rebalancing on China trip

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(Agencies)
Updated: 2009-11-07 17:48

WASHINGTON: US President Barack Obama will seek to reinforce the US desire for more balanced global growth during his trip to Asia this month, administration officials said on Friday.

Obama leaves on Wednesday for a trip to Japan, Singapore, China and South Korea. Trade will be on the agenda at each stop, but economic issues will be particularly significant in China, the largest holder of US government debt and America's second-largest trading partner.

"This is a region that depends heavily on having an open and dynamic trading system. It needs balanced growth," US Deputy Secretary of State James Steinberg said during a panel discussion at the Center for American Progress think tank.

"It needs all the countries in the region to do their part," he said.

Before the global economic slump began, Asian countries -- notably China -- were exporting large amounts of goods to the United States "and achieving prosperity based on the profligacy of the American consumers," Jeffrey Bader, Obama's top National Security Council official for East Asia, said in a speech on Friday at the Brookings Institution think tank in Washington.

"That is not a sustainable model and we have been very clear to the Chinese government about that, that recovery would require different models, different steps by both sides," Bader said.

The value of China's currency, the yuan, is also expected to come up during Obama's visit on Nov. 15-19.

The yuan has consistently been a focus in US-China trade disputes as US critics say China intentionally keeps its currency undervalued to gain advantages. China says its stable exchange rate helps its exporters and promotes stability in the global economy.

"It is an integral part of US policy that China should be moving toward a market-based value for its currency," Bader said.

Steinberg is one of the key architects of the Obama administration's China policy. In an indication that Obama plans to raise the issue of currencies with Chinese President Hu Jintao, he said the administration wants to see China address some of the policies "that artificially promote exports" and "their overall approach to macroeconomic policy."

Overall, the administration officials said Washington welcomes China's growing influence on global affairs but wants it to use that clout responsibly to issues, such as addressing the nuclear ambitions of Iran and the Democratic People's Republic of Korea and imbalances in the global economy.

"None of the great issues of the day can be addressed without Chinese cooperation," Bader said.