China raises Tibet issue with President Patil

Beijing, May 28 — Chinese President Hu Jintao and Chairman of National People’s Congress Wu Bangguo avoided the touchy Tibet issue. So it was left to Jia Quinglin to give the parting shot to President Pratibha Devisingh Patil in Beijing on Friday.

External Affairs officials said it wasn’t unusual for Quinglin to raise the Tibet issue and convey “concern” about the Dalai Lama’s “activities” in India. “He is the Chairman of the Chinese People’s Political Consultative Conference (CPPCC) that deals with ethnic issues in China, and that includes the Tibetans,” an official said.

The 2196-member strong CPPCC is regarded as China’s top political advisory body. The 70-year-old Jia met Patil at the Great Hall of the People in the afternoon.

While waxing eloquent on India’s age-old relationship with China, he raised the Tibetan issue. Jia described the Dalai Lama as more of a political leader than a spiritual figure.

But Patil referred to as the Dalai Lama as a spiritual leader “who stays in India”. The President, officials said, told Jia that India regarded Tibet Autonomous Region as a part of China and “this does not allow any anti-China activities by Tibetans in India”.

The President cited the example of Olympic torch relay in India ahead of the 2008 Beijing Olympics and how the Indian government took steps to ensure nothing untoward happened. Later, at her first public speech during her six-day visit, Patil told China’s leadership that ‘mutual understanding of each other’s sensitivities’ held the key to “deeper and sturdier friendship” between the two Asian giants.

She emphasized the “time-tested” Sino-India friendship “forged in the crucibles of civilisation”, foreseeing growing scope for cooperation between the two countries.

China holds door open a crack to U.S. on yuan

China struck a conciliatory note in talks with the United States on Monday by vowing to spur domestic demand and keeping a guarded opening to exchange rate reform, which the Obama administration says is needed to rebalance the global economy.

The United States treaded softly on the subject and welcomed Beijing’s long-standing pledge to reform the yuan as the two sides opened their second Strategic and Economic Dialogue.

But both countries also made clear that a stronger Chinese currency was not enough by itself to narrow the whopping U.S. bilateral trade deficit that has fuelled tensions between them at a time when the global economic recovery remains fragile.

While Chinese President Hu Jintao broke no new ground on the yuan dispute, he set an amicable tone for the two days of talks during which the world’s biggest and third-biggest economies will seek to steady their relations.

“China will continue to steadily advance reform of the renminbi exchange rate formation mechanism following the principles of being independent, controllable and gradual,” he said. The renminbi is another name for the yuan.

Hu said his government wanted to expand domestic demand to create more balanced growth, something that Washington — worried about its yawning trade deficit with China — has also advocated.

U.S. Treasury Secretary Timothy Geithner said the Chinese government was moving in the right direction on the yuan, which has been effectively pegged to the dollar since the global financial crisis worsened in mid-2008.

“We welcome the fact that China’s leaders have recognized that reform of the exchange rate is an important part of their broader reform agenda,” he said.

Trying to press the case that appreciation would be in China’s own interest, Geithner said that a more market-driven exchange rate would help suppress inflation while also driving private firms to move up the value chain.

TRADE POLICIES

China and the United States signalled that there could be progress on two other trade-related policies that have been additional irritants in their relations.

China said that it was working to resolve the concerns of foreign companies about an “indigenous innovation” programme that the United States has said was unduly restrictive and a concern on par with the yuan.

And Chinese Commerce Minister Chen Deming said he was optimistic that the United States would loosen controls over high-tech exports, a move that would go a small way to balancing their trade ties.

The talks also touched on Europe’s debt woes, with both sides saying that they were cautiously optimistic that any fallout would be limited.

“The general view was that the pace of the global economic recovery will be basically maintained,” People’s Bank of Governor Zhou Xiaochuan told a news conference.

The one slight point of open discord were U.S. calls for a tougher line against North Korea over an alleged sinking of a South Korean warship, contrasting with China’s appeals for restraint.

Tensions flared between Beijing and Washington in the first months of 2010, when China denounced U.S. criticism of its Internet censorship, Washington’s arms sales to Taiwan, and President Barack Obama’s meeting with the Dalai Lama, Tibet’s exiled leader.

Beijing considers Taiwan a part of its territory, and Hu said on Monday that it was important for countries to respect one another’s sovereignty.

Beijing officials have said they want only “quiet discussion” of U.S. complaints that the Chinese currency is held too low in value, giving Chinese manufacturers an unfair advantage.

The Obama administration so far appears willing to go along in the hope that a quieter approach will give Beijing more political space to let its currency appreciate.

The annual U.S. trade deficit with China fell to $226.8 billion in 2009 from a record $268.0 billion in 2008. But the Obama administration is keen to lift exports, and the deficit remains a point of friction with Beijing.

(Additional reporting by Arshad Mohammed and Doug Palmer; Editing by Ken Wills)

China quake toll mounts to 1,100, hopes for survivors fade

Beijing, Apr 17(ANI): The death toll from the devastating earthquake that struck a Tibetan area in northwest China’s Qinghai Province rose to 1,100 on Saturday morning, with another 417 remaining missing.

Wednesday’s earthquake that measured 7.1 on the Richter scale, is believed to be the strongest to hit the country in nearly two years, and has left 11,744 people injured, including 1,192 serious cases.

Rescuers said that the toll is expected to rise as freezing nights, with temperatures around minus three degrees C, become increasingly difficult for survivors under the debris to bear.

Altitude sickness and low oxygen have already caused tremendous challenges for rescuers, volunteers and reporters alike, The China Daily reports.

The quake and a string of aftershocks, the biggest being 6.3 magnitude, toppled houses, temples, gas stations and electric poles, triggered landslides, damaged roads, cut power supplies and disrupted telecommunications. A reservoir also developed cracks, which workers are trying to patch.

Chinese President Hu Jintao and Premier Wen Jiabao have ordered local authorities to spare no effort in search and rescue operations, and in the caring of the victims.

According to the Qinghai provincial government, over 5,000 rescuers, including soldiers and medical workers, are at the quake-hit region,

Authorities in the neighboring provinces of Gansu and Sichuan and the Tibet autonomous region are also involved in the rescue efforts. (ANI)

BRIC signs pact to facilitate cooperation between development banks

Brasilia (Brazil), Apr.16 (ANI): Brazil’s President Luiz Inacio Lula da Silva, Russian President Dmitry Medvedev, Indian Prime Minister Manmohan Singh and Chinese President Hu Jintao on Thursday witnessed the signing of a pact that will facilitate cooperation between development banks of the four countries.

Brazilian National Development Bank President Luciano Coutinho signed a memorandum of cooperation with his other three counterparts from Russia, India and China.

The agreement seeks to establish mechanisms to enhance trade and economic relations between BRIC countries.It also includes the possibility of co-financing projects of common interest in areas such as infrastructure, energy, industry, high technology and export.

At the end of the summit, BRIC leaders signed a joint declaration outlining their common vision on global issues, including:

The need for reform in the United Nations to make the institution more efficient and representative, in order to better address global challenges.

The need to join economic efforts and adopt sustainable fiscal policies to ensure a full recovery from the global financial crisis and long-term economic growth.

“We are confident that the unity we achieved here will contribute to the construction of a space for dialogue and consultation. Brazil, Russia, India and China have a key role to play in the establishment of a new international order that is more representative, fairer and safer,” said Brazilian President Lula.

Chinese President Hu Jintao said the meeting was fruitful,and added that the debate not only reflects the collective interests of the group, but of all countries of the world.

China will host the third BRIC summit at a date yet to be defined.

Russia intends to deepen the dialogue on tackling global challenges such as terrorism and organized crime.

“The BRIC format allows us complete action,” said Russian President Dmitry Medvedev.

Prime Minister Manmohan Singh reaffirmed the need for continued cooperation, reiterating that the four countries can make considerable contribution to global prosperity.

“The global financial crisis has given new relevance to the BRIC countries,” he added.

In the period from 2003 to 2007, the BRIC countries accounted for 65 percent of the world’s GDP growth. In 2009, the GDP of BRIC countries (by purchasing power parity) reached 16.3 trillion USD, corresponding to 23.4 percent of the global economy. In the period 2003-2008, there was an increase of 382 percent in the volume of trade between Brazil and the other BRIC countries from 10.7 billion USD in 2003 to 51.7 billion USD in 2008.

The summit was originally scheduled for Friday (April 16), but was advanced by a day in order to accommodate President Hu Jintao’s decision to shorten his trip to return hom to take control of the decision-making process for the earthquake that hit his country earlier this week. By Ravinder Singh Robin (ANI)

Brazil, China sign joint action plan for 2010 -2014

Brasilia, April 16 (ANI): Brazilian President Luiz Inacio Lula da Silva and Chinese President Hu Jintao signed a Joint Action Plan on Thursday at a meeting on the sidelines of the second annual BRIC (Brazil, Russia, India, China) Summit, outlining joint initiatives in industry, science and technology, agriculture, culture, education and statistics for the period from 2010 to 2014.

The two Heads of State also lauded the progress of the Petrobras and Sinopec agreement signed in May 2009. Based on the favorable results of the partnership to date, China and Brazil announced their intention to deepen cooperation in fields of energy and mining.

In his speech, Brazilian President Lula said that the plan is “an excellent roadmap” for Brazil-China bilateral relations that will allow for coordinated global action by the two countries.

In addition to the Joint Action Plan, several cooperation agreements were signed between Chinese and Brazilian companies and State agencies, including a partnership between Brazil’s EBX and Chinese state-owned WISCO.

The two companies are negotiating the construction of a steel-making complex in the Port of Agu, Rio de Janeiro, that Lula stated will be the largest Chinese investment in Brazil and China’s largest in steel investment abroad.resident Lula stressed the advancement of bilateral trade between Brazil and China, which grew 780 percent between 2003 and 2009.

Today, China is Brazil’s largest trading partner. The President Lula, however, pointed out the need to raise the quality of the trade exchange currently made by Brazil. For the promise of South-South cooperation to become a reality, Brazil must increase the added value of its sales. The aviation sector can help make our exchanges more balanced,” he said. hinese President Hu Jintao stated that China and Brazil are on the way to rapid development, and reiterated the interest of his country to develop comprehensive cooperation with Brazil.

The meeting between Lula and Hu Jintao is part of a series of meetings planned during the Chinese leader’s visit to Brazil.

The two Presidents will also participate in the second annual BRIC Summit later today, which will include the heads of government/state of Russia and India. By Ravinder Singh Robin (ANI)

Obama: al Qaeda bid to go nuclear is top threat

(Reuters) – President Barack Obama said on Sunday that efforts by al Qaeda to acquire atomic weapons posed the biggest threat to global security, and world leaders meeting this week must act with urgency to combat this danger.

Barack Obama

Obama, speaking on the eve of an unprecedented 47-nation summit in Washington aimed at thwarting nuclear terrorism, said he expected “enormous progress” at the conference toward the goal of locking down loose nuclear material worldwide.

“The central focus of this nuclear summit is the fact that the single biggest threat to U.S. security — both short-term, medium-term and long-term — would be the possibility of a terrorist organization obtaining a nuclear weapon,” Obama told reporters.

“We know that organizations like al Qaeda are in the process of trying to secure a nuclear weapon — a weapon of mass destruction that they have no compunction at using,” Obama said before talks with South African President Jacob Zuma.

Nuclear non-proliferation experts say there are no known instances of terrorist groups obtaining highly enriched uranium or plutonium that could be used to make a crude nuclear bomb but note there have been 18 cases of nuclear material being stolen or going missing since the early 1990s.

“This is something that could change the security landscape of this country and around the world for years to come,” Obama said, warning of the potential consequences if a nuclear bomb were detonated.

Obama’s goal at the two-day summit is to get nations to agree to secure vulnerable nuclear material within four years and to take specific steps to crack down on nuclear smuggling.

WIDE-RANGING TALKS

The president held talks on Sunday with the prime ministers of nuclear-armed foes India and Pakistan, Kazakh President Nursultan Nazarbayev and South Africa’s Zuma. He will see Chinese President Hu Jintao, Jordan’s King Abdullah and the leaders of Malaysia, Ukraine and Armenia on Monday.

Signaling the U.S.-led push for new sanctions on Iran is on leaders’ minds even if not on the summit agenda, the White House said Obama told Zuma a “strong and unified international response” is required over Tehran’s nuclear program.

The West wants further sanctions to deter Iran from what is seen as a covert nuclear weapons development drive, while Tehran says it has only peaceful nuclear ambitions.

Prime Minister Yusuf Raza Gilani “indicated his assurance that Pakistan takes nuclear security seriously and has appropriate safeguards in place,” the White House said. It said Obama reasserted to Gilani “the importance of nuclear security, a priority he has reiterated for all countries.”

Nuclear non-proliferation experts say Pakistan’s nuclear arsenal and stockpile of weapons-grade nuclear material is heavily guarded but the threat from al Qaeda and the Taliban make the country one of the areas of greatest concern.

Pakistan is still trying to move out from the shadow cast by scientist Abdul Qadeer Khan, who was at the center of the world’s biggest nuclear proliferation scandal in 2004. He has confessed to selling secrets to Iran, North Korea and Libya.

In his 50-minute meeting with Indian Prime Minister Manmohan Singh, Obama heard a litany of concerns about India’s neighbor Pakistan, according to Indian Foreign Secretary Nirupama Rao, who briefed reporters.

Singh talked to Obama about the activities of Lashkar-e-Taiba, the Pakistan-based militant group responsible for the 2008 Mumbai attacks, “and also the fact that unfortunately there was no will on the part of the government of Pakistan to punish those responsible for the terrorist crimes in Mumbai,” Rao said.

India and Pakistan have fought three wars since 1947 and several smaller conflicts, including one in 1999. Both nations conducted nuclear tests in 1998 and are not signatories to the Nuclear Non-Proliferation Treaty.

KAZAKHSTAN AS MODEL?

White House officials said Obama praised Kazakhstan’s Nazarbayev as a model leader in their meeting for the steps he has taken to denuclearize his central Asian nation.

The former Soviet Union carried out nearly 500 atmospheric and underground nuclear test explosions in Kazakhstan between 1949 and 1989. Nazarbayev closed the testing site in 1991 and has disposed of more than 100 nuclear warheads.

The Kazakh government has erected posters around Washington ahead of the summit highlighting the country’s decision to get rid of its nuclear arsenal, once the world’s fourth largest.

White House officials said Obama would also meet Turkish Prime Minister Tayyip Erdogan on the sidelines of the summit. A U.S. congressional committee last month voted to label the World War One-era massacres of Armenians by Turkish forces as genocide, angering Ankara and prompting it to recall its ambassador from Washington.

(Additional reporting by Matt Spetalnick and Susan Cornwell; editing by Eric Walsh and Todd Eastham)

U.S. and China ties grow closer

(Reuters) – Chinese President Hu Jintao’s visit to Washington for a nuclear security summit this week is the latest sign of a warming in relations with President Barack Obama’s administration that looks set to continue in the months ahead.

The two leaders, who hold a one-on-one meeting on the sidelines of the summit on Monday, are expected to work more closely this year on a range of issues, including Iran’s nuclear ambitions, military cooperation and North Korea.

Beijing may also be close to revaluing its yuan currency and unveiling a long-awaited shift in its foreign exchange regime. Washington has argued that it is in the interest of China, and the world, to let the yuan strengthen.

U.S.-Chinese relations have improved rapidly since April after months of disputes over China’s currency and Internet controls, U.S. arms sales to Taiwan and Obama’s meeting with the Dalai Lama at the White House.

“China reacted maybe a bit tougher rhetorically than in the past and than we had expected,” said Bonnie Glaser, a China expert and senior fellow at the Center for Strategic and International Studies in Washington.

But she added, “The reaction was limited primarily to rhetoric,” with China, for example, threatening to impose sanctions on U.S. goods, but never actually moving to do so.

After weeks of coyness, Beijing announced on April 1 that Hu would attend the two-day nuclear security summit.

Days later, Washington said it would delay a report that could have labeled China a currency manipulator.

“The relationship with the Chinese goes up and goes down,” said J.J. Ong, an Asia expert at the House of Representatives Foreign Affairs Committee. “There are cycles to it.”

Hu and Obama had an extended telephone conversation on April 1 in which Obama urged Hu to help ratchet up pressure on Iran over its nuclear activities, after China agreed to join serious talks about possible new U.N. sanctions on Tehran.

“I think what we’ve seen throughout the year is that at important junctures, the president’s bilateral meetings and conversations with these leaders helps kind of move things forward,” Ben Rhodes, deputy national security adviser for strategic communications, told reporters this week.

“Our view from the beginning has been is that if you really want to broaden the ability to isolate Iran and to affect its cost-benefit analysis as it relates to their continued failure to live up to their obligations, that you needed to bring in a broader coalition, and that Russia and China would be important parts of that effort,” he said.

‘IT WON’T BE ROSY’

Analysts said they would be looking for more from China on Iranian sanctions, a resumption of U.S.-Chinese military cooperation and signs of whether China can help bring North Korea back to six-party talks seeking to end Pyongyang’s nuclear ambitions in exchange for aid.

“It won’t be rosy. If we can manage the currency issue, and Iran and North Korea — by manage, I do mean manage, and not solve — then I think that we will at least build some sort of a track record of some positive accomplishments between our two countries,” Glaser said.

Hu is also expected to make a state visit to Washington later this year, to return Obama’s visit last November, and U.S. Secretary of Defense Robert Gates may visit China.

“Tensions are down and both sides are stressing the positive,” said Kenneth Lieberthal, director of the John L. Thornton China Center at the Brookings Institution.

At the center of the strategy is the administration’s ability to keep global issues central to the Washington-Beijing relationship, separate from disputes over trade and currency between the United States and its largest creditor.

“If the Chinese had really high expectations with Obama coming into office, after what he said about it being one of the most important bilateral relationships and elevating strategic dialogue to show the importance China has in U.S. foreign policy, invariably they were going to be disappointed when the U.S. sold weapons to Taiwan or met with the Dalai Lama or criticized the Chinese human rights record,” said Walter Lohman, head of Asian studies at the Heritage Foundation.

No one expects economic issues to go away.

Washington must still issue the hotly anticipated currency report, and the White House is under pressure from Congress to name China a currency manipulator. The Obama administration is generally expected to bring other countries into its effort to push China on the yuan, which may be a theme at the G20 summit in Canada in June.

“Looking back next year, my guess is if there is seen to be a major problem in U.S.-China relations during the course of 2010 … it will be the trade relationship,” Lieberthal said.

He said the issue was a potent one politically, especially with U.S. congressional elections in November. A combination of high U.S. unemployment and the huge U.S. trade deficit has made China an easy target, and put pressure on Obama to get tough with Beijing on trade and currency issues.

“It (the currency issue) is clear and simple and therefore politically powerful,” Lieberthal said.

(Additional reporting by Paul Eckert; Editing by Peter Cooney)

Hong Kong hits near 3-mth high, China stocks edge up

* HK stocks rise 1.3 pct to near 3-mth high

Financials

* ZTE Corp, Tsingtao rise on strong earnings

* China stocks rise 0.49 pct (Updates to midday)

By Sui-Lee Wee and Lu Jianxin

HONG KONG/SHANGHAI, April 9 (Reuters) – Hong Kong stocks rose 1.34 percent by midday on Friday nearing a three-month high as strong earnings from ZTE Corp (0763.HK) and Tsingtao Brewery (0168.HK) and hopes of appreciation in the yuan lifted mainland stocks.

China’s main stock index edged up 0.49 percent, buoyed by a buying spree in new listings, but it remained captive to range-bound trade as strong corporate earnings offset liquidity tightening efforts by authorities.

In Hong Kong, the benchmark Hang Seng Index .HSI gained 1.3 percent, or 293.39 points, to cross the 22,000-mark that market players considered a strong resistance. The China Enterprises Index .HSCE of top locally listed mainland Chinese stocks was up 1.28 percent at 13,020.09.

Market turnover rose to HK$42.65 billion ($5.50 billion) from midday Thursday’s HK$37.75 billion.

“The market’s in a very good mood,” said Jackson Wong, investment manager at Tanrich Securities. “Since we broke through the 21,800 level, investors are diving in, buying the laggards and the big blue chips.”

“The downside is limited — we don’t see any negative news on the horizon,” Wong said.

Market heavyweight HSBC (0005.HK) rose over 2 percent, adding about 66 points to the overall gain on the Hang Seng.

The yuan CNY=CFXS closed at its highest level since October 2009 on Thursday after the New York Times reported China was close to announcing a currency policy shift that would involve a small but immediate revaluation of the yuan. [ID:nTOE63707P].

This, combined with U.S. Treasury Secretary’s Timothy Geithner surprise visit to Chinese Vice Premier Wang Qishan and Chinese President Hu Jintao’s impending visit to the United States next week, has intensified speculation that China might soon revalue its currency, lifting stocks in the past weeks.

Manufacturers, which import raw materials and sell domestically, and airlines, which spend heavily in dollars to purchase aircraft, are likely to be the biggest beneficiaries of the yuan appreciation, Wong said. A stronger yuan also inflates the value of the companies’ assets for foreign investors.

Air China (0752.HK) rose 2.7 percent.

ZTE, China’s No.2 telecoms equipment maker, rose 2.7 percent after the company said its quarterly profit rose 50 percent on booming exports, in line with expectations. [ID:nTOE63606S]

Tsingtao Brewery, China’s best-known beer brand and No.2 brewer by volume, gained 2 percent after it posted a 91.7 percent rise in second-half profit on rising beer sales and lower raw material costs. [ID:nTOE63708T]

SHANGHAI EDGES UP

The Shanghai Composite Index .SSEC ended the morning at 3,133.957 points, recouping part of a 0.94 percent fall on Thursday.

A string of listed companies have recently issued estimates of strong gains in first-quarter earnings, which are pending auditor scrutiny before actual numbers are published, citing China’s strong economic recovery as the key factor.

SAIC Motor Corp (600104.SS), China’s biggest automaker, said on Friday its first-quarter net profit rose to more than four times the year-ago result, boosted by government steps to bolster car purchases. [ID:nTOE63800V]

SAIC Motor’s Shanghai-listed, yuan denominated A shares rose 0.3 percent by midday, a relatively modest performance as investors had expected its earnings to jump.

“Investors have got accustomed to forecasts of strong earnings,” said a senior trader at a major Chinese brokerage in Shenzhen. “But they are still cautious not to rush into the market amid uncertainties over monetary policy trends.”

The People’s Bank of China resumed issuance of longer-term three-year bills on Thursday for the first time since mid-2008, stepping up its efforts to drain excessive liquidity from the market. [ID:nTOE63702X]

Friday morning’s Shanghai A-share turnover fell slightly to 66 billion yuan ($9.7 billion) from the previous morning’s 69 billion yuan, while rising Shanghai stocks outnumbered fallers by 632 to 242.

Market newcomer Suzhou Dongshan Precision Manufacturing Co (002384.SZ), a hardware producer, was the morning’s biggest gainer by far, jumping 150 percent from its initial public offering price of 26 yuan.

Chemical maker Yibin Tianyuan Group (002386.SZ) was up 94 percent from its IPO price while agricultural issue Beijing Dabeinong Technology Group (002385.SZ) rose 69 percent from its IPO price.

Sudden yuan rise would harm global economy -PBOC adviser

SHANGHAI, April 8 (Reuters) – A sudden rise in the yuan would hurt the global economy as well as U.S. consumers, Xia Bin, a member of the Chinese central bank’s monetary policy committee, said on Thursday.

“It’s not in the core interest of the U.S. to see the yuan appreciate,” Xia told a financial conference.

He added that China should peg the yuan to a basket of trade-weighted currencies within a few years.

China on Wednesday showed readiness to resume appreciation of the yuan when the National Development and Reform Commission, the powerful central planning agency, alerted exporters to potential foreign exchange risks to minimise their losses.

China has pegged the yuan CNY=CFXS at around 6.83 to the dollar since mid-2008 to offset the financial crisis, drawing increasing criticism from the United States that the allegedly undervalued currency is giving Chinese exporters an unfair trading advantage.

Speculation that Beijing will let the yuan rise in the next few months has been fuelled by an easing of Sino-U.S. tensions over the currency in recent days.

U.S. Treasury Secretary Timothy Geithner said at the weekend that he was delaying an April 15 report on whether China manipulates its currency, ahead of a visit by Chinese President Hu Jintao. ($1=6.83 Yuan) (Reporting by Samuel Shen and Jacqueline Wong; Editing by Edmund Klamann)

Nuclear summit takes aim at unsecured bomb material

Dozens of world leaders gather in Washington next week for an unprecedented meeting on nuclear security, with U.S. President Barack Obama hoping they can agree on how to keep atomic bombs out of terrorists’ hands.

Although the gathering of 47 countries will not focus on individual nations, the nuclear programs of Iran and North Korea — and possible new U.N. sanctions against Tehran — are expected to come up in Obama’s bilateral meetings with Chinese President Hu Jintao and other leaders, as well as in the speeches of Israeli and other participants.

Hu’s decision to attend the summit, Western diplomats said, was a major victory for Obama, since it indicates that Beijing does not want bilateral tensions over Taiwan and other issues to cripple Sino-U.S. relations and cooperation on other key security and foreign policy topics.

A draft communique circulated to countries attending the summit, the contents of which were described to Reuters, includes a U.S. proposal to “secure all vulnerable nuclear material in four years.” The draft text will likely be revised before it is adopted at the end of the April 12-13 meeting.

Analysts and Western diplomats say the significance of the summit meeting — one of the biggest of its kind in Washington since World War Two — goes far beyond its official agenda.

“Too many people see nuclear security as a narrow technical issue of concern only to those most fearful of nuclear terrorism,” Ian Kearns of British American Security Information Council said in a report.

“If leaders at the summit get it right, they could render nuclear power safer to use in the fight against climate change, strengthen the non-proliferation regime, and build further international confidence in … nuclear disarmament,” said Kearns, who is an adviser to Britain’s parliamentary committee on national security.

In addition to China’s Hu, attendees include Russian President Dmitry Medvedev, French President Nicolas Sarkozy and German Chancellor Angela Merkel.

Also represented will be India and Pakistan, which never signed the 1970 nuclear Non-Proliferation Treaty but have atomic arsenals, and Israel, another NPT holdout that is presumed to have atomic weapons but has never confirmed it.

NO INVITATIONS FOR IRAN, NORTH KOREA

The inclusion of Pakistan, diplomats say, is important since it is one of the countries that has pledged to improve its internal safeguards. Disgraced Pakistani scientist Abdul Qadeer Khan was the kingpin of an illicit atomic network that provided atomic technology to Iran, North Korea and Libya.

Two nations excluded from the meeting are Iran, which the United States and its Western allies accuse of pursuing nuclear weapons, and North Korea, which withdrew from the NPT in 2003 and has twice detonated nuclear devices despite its promise to abandon its atomic programs. Both are under U.N. sanctions.

Joe Cirincione, a professor at Georgetown University and head of the Ploughshares Fund anti-nuclear arms group, said the plan to secure nuclear materials worldwide within four years could substantially boost global security.

“If they follow through, this strategy could effectively prevent nuclear terrorism by stopping radicals from getting the one part of the bomb they cannot make themselves,” he said.

But Cirincione wants to see if the final communique is “more than a 2-page press release, if the action plan has real targets and real deadlines, if key nations pledge to secure their weapons material within four years, and if the states agree to meet again in two years to assess progress.”

On the agenda are plans to join together a disparate group of countries with nuclear programs to gather up dangerous atomic material from vulnerable nuclear, defense and medical sites worldwide, something Russia and the United States have been doing with the aid of the U.N. atomic watchdog for years.

If successful, the summit can send a strong signal to the world that the international community is united in boosting nuclear security and that Washington is taking a leading role.

The White House on Tuesday unveiled a new policy that restricts U.S. use of nuclear weapons, while sending a stern warning to Iran and North Korea that they remain potential targets. Reversing the position of the former U.S. administration, the so-called Nuclear Posture Review also said Washington would not develop any new atomic weapons.

Analysts said the combination of the U.S. nuclear policy, the success of Obama and Medvedev in agreeing a new treaty committing them to reducing their atomic arsenals, and a productive nuclear summit could help set the stage for a successful gathering of NPT signatories in New York next month to find ways to overhaul the 40-year-old arms pact.

Analysts say the NPT has been battered by North Korea’s withdrawal, Iran’s insistence on pursing nuclear technology that could help it make bombs and developing nations’ charges that big nuclear powers are ignoring disarmament commitments.

Possible new U.N. sanctions against Iran over its nuclear program will be the focus of a Thursday meeting of envoys from the United States, Britain, France, Germany, China and Russia in New York. U.N. diplomats said their leaders were ready to discuss Iran on the sidelines of the summit if Obama wants to.

The four Western powers have persuaded China and Russia to help draft a fourth U.N. sanctions resolution against Tehran for refusing to suspend its nuclear enrichment program. Iran rejects Western allegations that its atomic program is aimed at developing weapons and refuses to stop enriching uranium.

(Editing by Mohammad Zargham)

Hu’s U.S. visit key for yuan move: adviser

(Reuters) – A successful visit by Chinese President Hu Jintao to Washington this month could open the door for an adjustment in China’s yuan policy, but another one-off revaluation should be avoided, a central bank adviser said on Friday.

China

“The adjustment should be carried out at a time that is appropriate. We need to find the right time, but a one-off adjustment won’t benefit either China or United States,” said Li Daokui, a member of the central bank’s monetary policy committee, told Reuters in an interview.

“It will hinge on President Hu’s visit to the United States. If the talks are successful, we could made an adjustment based on China’s own conditions,” he said, without elaborating.

Hu will attend a nuclear security summit in Washington on April 12-13, despite initial uncertainties about whether he would go.

The nuclear summit will open days before the U.S. Treasury is due to release a report on whether China is distorting its currency exchange rate to boost its exports.

Domestic U.S. political pressure has been building on Treasury to label China a “currency manipulator” in its April 15 report on global currency policies, but analysts believe Hu’s decision to proceed with the trip is an indication that it will not do so.

China has been facing stiff pressure from the United States and other Western powers which say Beijing is keeping its currency artificially low to give Chinese exporters an advantage in world trade.

Beijing allowed the yuan to rise 21 percent against the U.S. dollar between July 2005 and July 2008 before effectively repegging the currency, also known as the renminbi, near 6.83 to the dollar to help the economy through the global financial crisis.

The yuan issue has been politicized by some foreign countries, but Hu’s planned visit signaled easing tensions which could remove a barrier for China carrying out currency reforms, Li said.

Asked about when the People’s Bank of China (PBOC) will consider raising interest rates, Li said it would hinge on upcoming economic data, particularly March figures due to be released soon.

The PBOC has already taken some smaller steps this year to prevent the surging economy from overheating, such as raising banks’ reserve requirements, and strong data recently has provided fresh arguments for more tightening sooner rather than later.

“The situation is very complicated this year,” said Li, an influential economist at Beijing’s elite Tsinghua University who was recently appointed one of three academic advisers to the central bank.

Worries about Chinese policy tightening have spooked financial markets in recent months as China has largely led the global economic recovery.

INFLATION CONCERNS

China will be able to sustain strong economic growth in the next few years and the government’s focus is controlling inflation expectations and asset price bubbles, Li said.

Public expectations on consumer prices would be crucial for the government to maintain a lid on inflation, he said.

Some analysts say inflation is set to accelerate this year given the ample liquidity in the banking system and huge bank loans.

Although the consumer price index rose only 2.7 percent in the year to February, surging property prices are a harbinger of broader inflation in an economy that is likely to record year-on-year GDP for the first quarter well into double digits.

“High liquidity alone won’t be enough to push up inflation, but liquidity in conjunction with rising asset prices and inflation expectations will lead to higher inflation,” said Li, a Harvard-trained economist.

(Editing by Benjamin Kang Lim & Kim Coghill)

Obama, China’s Hu talk Iran, trade in hour call

(Reuters) – Chinese President Hu Jintao told U.S. President Barack Obama their two nations should defuse economic strains through negotiations, but neither leader touched on the yuan dispute in remarks published on Friday.

Barack Obama

Hu made the conciliatory comments in an hour-long talk with Obama that also covered the Iran nuclear dispute and China’s demands over Tibet and Taiwan, two areas that recently flared as sore-spots in U.S.-China relations.

The top-level talk capped a week of easing tensions between the two big powers.

China said on Thursday that Hu would attend a summit in Washington on nuclear security later this month and diplomats said Beijing had agreed to join in talks with Western powers about a fresh round of U.N. sanctions against Iran.

“President Obama underscored the importance of working together to ensure that Iran lives up to its international obligations,” the White House said in a statement after the telephone call, on Thursday Washington time, which was Friday in Beijing.

“He also emphasized the importance of the United States and China along with other major economies implementing the G20 commitments designed to produce balanced and sustainable growth.”

Chinese media reports of the conversation did not mention Iran, instead touching on Hu’s desire for talks to resolve trade spats, the importance of healthy ties between the two nations, and stressing Beijing’s sensitivity about Tibet and Taiwan.

“Both China and the United States face the task of boosting the economic recovery and maintaining stable economic development,” Chinese state television quoted Hu saying.

“I hope that the two sides can well address economic and trade problems via equal consultations and contribute to the broader goal of China and U.S. trade and economic cooperation.”

The potentially touchy issue of China’s currency, the yuan, did not appear in either country’s public account of the chat. But those accounts may not have covered all of their discussion.

The nuclear summit will open days before the U.S. Treasury is due to release a report on whether China is distorting its currency exchange rate to boost its exports.

Domestic U.S. political pressure has been building on the Obama administration to label China a “currency manipulator”.

But if it does the slap would come just as ties are improving, and at a time when Washington is seeking help on diplomatic issues such its drive for new sanctions on Iran.

IMPORTANT RELATIONSHIP

The relationship between Beijing and Washington has been dragged down in recent months by disputes spanning China’s currency and internet controls, U.S. arms sales to the self-ruled island of Taiwan, and Obama’s meeting with exiled Tibetan spiritual leader the Dalai Lama.

Beijing says Taiwan is an illegitimate breakaway from mainland rule, and it condemns the Dalai Lama as a “separatist” for seeking self-rule for his homeland.

Hu stressed that these are still vital concerns for China.

“The Taiwan and Tibet issues are key to China’s sovereignty and territorial integrity, and relate to China’s core interests. Appropriately handling these issues is key to ensuring the healthy and stable development of U.S.-China ties,” he was quoted saying.

“Since President Obama took office, with the hard work of both sides, China-U.S. ties have show a trend of positive development,” Hu said.

Both leaders agreed to work hard to ensure positive results at a second round of their Strategic and Economic Dialogue, which will be held in May, Chinese state media reported.

The United States welcomed Hu’s decision to attend the nuclear security summit, saying it would allow them to address a “shared interest in stopping nuclear proliferation and protecting against nuclear terrorism”.

“They also discussed the importance of developing a positive bilateral relationship,” the White House statement added. (Additional reporting by Yu Le, Wang Lan and Zhou Xin in BEIJING, writing by Emma Graham-Harrison; Editing by Sanjeev Miglani)

UPDATE 2-Obama, China’s Hu talk Iran, trade in hour call

* Yuan not mentioned in reports of talk by either country

* Obama underlined importance of Iran cooperation

* Hu stressed trade, Tibet and Taiwan

By Jeff Mason and Chris Buckley

WASHINGTON/BEIJING, April 2 (Reuters) – Chinese President Hu Jintao told U.S. President Barack Obama their two nations should defuse economic strains through negotiations, but neither leader touched on the yuan dispute in remarks published on Friday.

Hu made the conciliatory comments in an hour-long talk with Obama that also covered the Iran nuclear dispute and China’s demands over Tibet and Taiwan, two areas that recently flared as sore-spots in U.S.-China relations.

The top-level talk capped a week of easing tensions between the two big powers.

RPT-China’s Hu tells Obama he wants healthy ties

BEIJING, April 2 (Reuters) – Chinese President Hu Jintao told U.S. President Barack Obama he wants healthy ties between the two nations, while stressing Beijing’s sensitivity about Taiwan and Tibet, Chinese television reported on Friday.

Hu made the remarks in a phone call to Obama, telling him that their two governments should focus on developing “healthy” ties and that he wanted to address trade issues via talks, the report said.

But Hu also told Obama that heeding China’s concerns about Tibet and the self-ruled island of Taiwan was also “vitally important” to good relations, it said. (Reporting by Yu Le, Zhou Xin, Wang Lan and Emma Graham-Harrison; Writing by Chris Buckley; Editing by Ben Lim)

China’s Hu tells Obama he wants healthy ties

BEIJING, April 2 (Reuters) – Chinese President Hu Jintao told U.S. President Barack Obama he wants healthy ties between the two nations, while stressing Beijing’s sensitivity about Taiwan and Tibet, Chinese television reported on Friday.

Hu made the remarks in a phone call to Obama, telling him that their two governments should focus on developing “healthy” ties and that he wanted to address trade issues via talks, the report said.

But Hu also told Obama that heeding China’s concerns about Tibet and the self-ruled island of Taiwan was also “vitally important” to good relations, it said. (Reporting by Yu Le, Zhou Xin, Wang Lan and Emma Graham-Harrison; Writing by Chris Buckley; Editing by Ben Lim)

White House: no decision on China currency policy

WASHINGTON, April 2 (Reuters) – The White House said on Friday that no formal decision has been made to delay a report on whether to declare China a currency manipulator.

The New York Times reported that the Obama administration, seeking to ease relations with Beijing, was deferring the decision until after a visit to Washington later this month by Chinese President Hu Jintao for a nuclear conference.

White House press secretary Robert Gibbs said no such decision has been made.

(Reporting by Jeff Mason; Writing by Thomas Ferraro; Editing by Sandra Maler)

White House consulting with China over Iran

WASHINGTON, April 2 (Reuters) – The White House said on Friday the United States was consulting with China on ratcheting up pressure on Iran and imposing further scansions over its nuclear program.

White House spokesman Robert Gibbs told a news briefing Washington was pleased with the progress made so far.

Chinese President Hu Jintao is due to attend a nuclear security summit in Washington this month.

(Reporting by Jeff Mason, Editing by Sandra Maler)

RPT-China’s Hu tells Obama he wants healthy ties

BEIJING, April 2 (Reuters) – Chinese President Hu Jintao told U.S. President Barack Obama he wants healthy ties between the two nations, while stressing Beijing’s sensitivity about Taiwan and Tibet, Chinese television reported on Friday.

Hu made the remarks in a phone call to Obama, telling him that their two governments should focus on developing “healthy” ties and that he wanted to address trade issues via talks, the report said.

But Hu also told Obama that heeding China’s concerns about Tibet and the self-ruled island of Taiwan was also “vitally important” to good relations, it said. (Reporting by Yu Le, Zhou Xin, Wang Lan and Emma Graham-Harrison; Writing by Chris Buckley; Editing by Ben Lim)

China’s Hu tells Obama he wants healthy ties

BEIJING, April 2 (Reuters) – Chinese President Hu Jintao told U.S. President Barack Obama he wants healthy ties between the two nations, while stressing Beijing’s sensitivity about Taiwan and Tibet, Chinese television reported on Friday.

Hu made the remarks in a phone call to Obama, telling him that their two governments should focus on developing “healthy” ties and that he wanted to address trade issues via talks, the report said.

But Hu also told Obama that heeding China’s concerns about Tibet and the self-ruled island of Taiwan was also “vitally important” to good relations, it said. (Reporting by Yu Le, Zhou Xin, Wang Lan and Emma Graham-Harrison; Writing by Chris Buckley; Editing by Ben Lim)

White House: no decision on China currency policy

(Reuters) – The White House said on Friday that no formal decision has been made to delay a report on whether to declare China a currency manipulator.

Barack Obama

The New York Times reported that the Obama administration, seeking to ease relations with Beijing, was deferring the decision until after a visit to Washington later this month by Chinese President Hu Jintao for a nuclear conference.

White House press secretary Robert Gibbs said no such decision has been made.

(Reporting by Jeff Mason; Writing by Thomas Ferraro; Editing by Sandra Maler)