The failure of this mission is a preview of things to come.
Houston, Texas (PRWEB) December 19, 2006
U.S. Treasury Secretary, Henry Paulson ended his two-day mission to Beijing in failure according to Jim Trippon, editor-in-chief of the China Stock Digest. Trippon says Paulson and his high-powered delegation have little to show for their efforts except for a tepid, face-saving statement that highlights America's economic weakness.
After closed-door talks, Paulson said China had pledged greater exchange rate flexibility, but Chinese officials gave no timetable and no specifics. "This kind of pledge means absolutely nothing," said Trippon. "America has been complaining that China's currency is artificially cheap for years and the Chinese have always responded the same way while doing virtually nothing to address U.S. concerns."
This month's talks were precedent-setting said Trippon because they involved the most senior economic officials of the U.S. cabinet as well as Federal Reserve chairman Ben Bernanke. "America's leading officials negotiated minor agreements to promote trade and the environment after being subjected to a defiant lecture and PowerPoint presentation in the Great Hall of the People by Deputy Prime Minister Wu Yi. Her stern talk indicates that America is now receiving second-fiddle treatment from a country in which appearances count for a great deal," said Trippon, a China veteran, analyzing the tenor of the discussions.
Chinese authorities portrayed American politicians as having limited knowledge and harboring misunderstanding going into the talks. "That language may sound diplomatic to western ears but it indicates total disdain for American arguments that China is at fault and that Beijing must adjust its policies and currency to suit our demands," said Trippon. "China is determined to continue growing and to become the world's number one economy despite U.S. complaints about unfairness," Trippon added.
The root of the controversy is America's growing trade deficit with China. "China's rise is inevitable and America might as well get used to becoming a second-best economy," said Trippon. "The failure of this mission is a preview of things to come."
The China Stock Digest is a monthly publication that helps individual investors profit from China's rapid economic growth. Jim Trippon is available for expert commentary by request. For more information or to schedule an interview with Jim Trippon, please visit http://www.chinastockdigest.com or contact Amal Zaid at (713) 661-3806.