'Stronger ties'

The United States and China must boost cooperation to strengthen the global economy and address international security problems, US President Barack Obama said Wednesday.

At the start of a four-day visit by Chinese President Hu Jintao, Obama called for a "level playing field" for US firms in China, but welcomed the latest signs of flexibility from Beijing.

"In other areas, we'll compete, a healthy competition that spurs both countries to innovate and become even more competitive," Obama said. "That's the kind of relationship I see for the United States and China in the 21st century and that's the kind of relationship that we advanced today."

One of the first announcements to come out of the meeting was an agreement from China to purchase more than $45 billion (33 billion euros) in US products. The deal includes China buying 200 Boeing aircraft.

"I welcomed his commitment that American companies will not be discriminated against when they compete for Chinese government procurement contracts," Obama said. "I appreciate his willingness to take new steps to combat the theft of intellectual property."

Breaking down barriers

At a joint meeting with business leaders, Hu said that China welcomes US companies and is speeding up its economic restructuring and trying to increase domestic consumption.

Increased Chinese demand for goods is a prime US concern because it could help reduce the trade gap with China. Obama addressed one of the major economic disputes between the two countries - Washington's contention that China's currency is undervalued and is hurting the U.S. economy as a result.

"I told President Hu that we welcome China's increasing the flexibility of its currency. But I also had to say that [it] remains undervalued, that there needs to be further adjustment in the exchange rate," Obama said.

Pushing human rights

In their meeting, the two leaders did not try to duck the contentious issue of China's record on human rights.

"History shows that societies are more harmonious, nations are more successful and the world is more just when the rights and responsibilities of all nations and all people are upheld, including the universal rights of every human being," Obama said during a welcoming ceremony for Hu outside the White House.

Nobel Prize winner Obama has been under pressure from some US lawmakers to raise rights issues with Hu, saying he has a duty to speak out.

In response, Hu said "a lot" still needs to be done to improve human rights in China. However he said China is a developing country with an enormous population facing challenges in economic and social developments. He said human rights must be viewed under those circumstances.

"China and the United States must respect each other's choices in development and each other's choices in development paths and each other's core interests," Hu said.

Obama's hosting of Hu for a state visit and dinner is the first for a Chinese leader in Washington for more than 13 years. Hu was greeted with a 21-gun salute, honor guards and the playing of both national anthems.

Author: Catherine Bolsover (Reuters, dpa, AP, AFP)
Editor: Rob Turner