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Today and tomorrow, President Hu Jintao will attend a nuclear security summit in Washington to discuss potential UN sanctions against Iran. China, who depends on Iran for 11% of its energy needs, has been hesitant in joining the US, UK, France and Germany in putting together a set of sanctions against the country.
China’s inclusion in the talks has been said to possibly signify a warming in Sino-US relations. Previously, tensions over US arms sales to Taiwan, the Google-China fiasco, Obama’s meeting with the Dalai Lama, and pressure on China to revalue the yuan, have all contributed to months of strained diplomacy.
Last week, Foreign Ministry spokesman Qin Gang said: “I’d like to reiterate that the undue disruption which China-US relations endured not long ago is in the interest of neither country and is not what we would like to see.”
Also a sign of renewed efforts is US Treasury Secretary Timothy Geithner’s meeting with Vice Premier Wang Qishan to address China’s currency controls. Washington and many economists have argued that China purposely keeps the RMB at an artificially cheap level, giving its exports an unfair cost advantage in global markets and fueling China’s persistent trade surpluses.
However, for fear of damaging delicate relations and embarrassing President Hu, Geithner decided to postpone the April 15th deadline set by Congress and the US Treasury to decide whether to label China a “currency manipulator.”
Meanwhile, for the first time since 2004, China posted a trade deficit in March of $7.2 billion, which takes a bit of steam out of the American position that the yuan is grossly undervalued.