WASHINGTON -- U.S. Treasury Secretary Henry Paulson said on Tuesday that rising anti-China sentiment in the United States was being fueled by growing trade and financial imbalances, and officials from both sides needed to find ways to ease such tensions.
In remarks prepared for the opening of two days of high-level talks between U.S. and Chinese officials in Washington, Paulson said both countries face challenges of domestic protectionism and questions about the merits of trade and globalization.
"There is a growing skepticism in each country about the others' intentions," Paulson said. "Unfortunately, in America, this is manifesting itself as anti-China sentiment as China becomes a symbol of the real and imagined downside of global competition. That argument is fueled by the evidence of persistent trade and financial imbalances."
Paulson said the United States was supportive of a stable and prosperous China and was not afraid of Chinese competition. While U.S. and Chinese officials may agree on the direction of reforms and other efforts to open the Chinese economy, he stressed that the pace of such changes needed to quicken.
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He said even the name for the talks — strategic economic dialogue — "may seem too passive for America's action-oriented ethic," adding they would be conducted under the "wary eyes" of politicians, business leaders and workers in both countries.
The Chinese delegation, led by Vice Premier Wu Yi, will meet later this week with U.S. lawmakers, some of whom have threatened punitive trade legislation unless China allows its currency to appreciate more quickly against the dollar.
"It is up to us, over these two days and in the work that follows, to show that words are precursors to action," Paulson said.
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