A persistent area of tension between the U.S. and China is trade, underscored by a deep imbalance and U.S. efforts to impose tariffs and other conditions on China.
President Obama has called China both a rival and a partner on trade and currency issues. Meeting with Chinese President Hu Jintao next week, he is expected to urge corrections.
“[Obama’s] challenge is to turn common interests into complementary policies, and that’s going to be hard,” said Evan Feigenbaum, an Asia policy expert at the Council on Foreign Relations.
The president has warned that China must stop manipulating its currency and be a better economic partner. But the U.S. does not have the economic leverage it once had. Among other things, China’s economy was only bruised and not hobbled by the global economic downturn.
“They have a huge amount of U.S. dollars that they are holding, so our success is important to them,” Obama told Reuters. “The flip side of that is that if we don’t solve some of these problems, then I think both economically and politically it will put enormous strains on the relationship.”
Obama is expected to push China to slow its exports, import more from the U.S. and increase domestic consumption. China has bristled at moves by the U.S. to impose tariffs on Chinese tires, steel and other exports.
