The United States is attempting a new method to tackle its widening trade imbalance with China. This is what Carlos Gutierrez's latest China visit, on November 13-17, has signaled.
This time round the U.S. secretary of commerce focused on "expansion of U.S. export opportunities," instead of pressing Beijing to concede on issues such as textile trade, intellectual property and renminbi's revaluation that dominated his previous three trips.
The change in tactical direction coincides with the proven failure of Washington's former hardline policy. According to U.S. statistics, the United States' September current-account deficit stood at $64.3 billion, a 6.8 percent drop month on month. In contrast, its negative trade balance with China remained an uptrend, rising to $22.96 billion from $21.96 billion in August.
The future should be focused on exporting to China as a way of improving our balance," Gutierrez told reporters in Beijing.
Gutierrez's high-stakes delegation consisted of executives of 25 big firms, including companies already operating in China such as Lucent Technologies and McGraw-Hill, as well as newcomers like Westinghouse and America's second largest insurance company Aon Group.
Encouragingly, China is also positive toward America's new approach. "It is not in its interests to have too high a trade surplus with the United States," said Chinese Minister of Commerce Bo Xilai.
In the nine months ending in September, U.S. exports to China totaled $40.2 billion, making China the United States' fourth largest export market.
A recent study report from the U.S. Department of Commerce has listed the areas where U.S. companies have an edge over China's other suppliers. China's 2006 imports in these areas, including telecom equipment, semiconductors, water supply and sewage disposal technologies and equipment, auto parts and medical equipment, are estimated at $49 billion.
Gutierrez revealed in Beijing that the U.S. Government will issue new rules in the next few months to clarify requirements for technology exports to China.
"The new rules will be an improvement because they will be more focused and more specific," Gutierrez told the media. "They provide predictability, and that should make things clearer for both parties."
Gutierrez also said that positive indications had been seen from the Democratic leaders of the newly elected U.S. Congress in so far as trade is concerned. "The initial signals and statements and comments that we have heard from Congress have been very positive from the standpoint of supporting trade," he said, adding it was important to be aware of any steps taken that signaled protectionism.
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