Lew made the comments after arriving in Beijing and reiterated them at the opening of the dialogue today, saying USA priorities included “undertaking further measures to reduce excess industrial capacity in key sectors such as steel, aluminum, and coal”.
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A meeting between Chinese President Xi Jinping and top North Korean diplomat Ri Su-yong on June 1st took Washington by surprise, and the U.S.is expected to continue pressing China to impose stronger sanctions on the North.
The meeting is chaired by US Secretary of State John Kerry and Treasury Secretary Jacob Lew and their Chinese co-chairs, State Councilor Yang Jiechi and Vice Premier Wang Yang.
On Monday, Lew said in Beijing, “Excess capacity has a distorting and damaging effect on global markets”.
“And it’s distorting global markets”, said Lew.
On people-to-people exchanges, Xi called on both sides to deepen friendship and facilitate bilateral interaction. “China also hopes the USA can treat Chinese enterprises equally during security reviews and prevent security reviews from becoming a barrier to cooperation between Chinese and US companies”.
In May, China’s Commerce Ministry denounced the United States anti-dumping ruling as “irrational”, and warned that it would hurt cooperation between the two economic powers. “And I think there are less obstacles for the USA on the deal this year”, Jin Canrong with Remin University of China said.
Instead of pursuing outdated Cold War mentality such as drawing lines for allies or showing off military power, Wang said these disputes and issues left by the history in the Asia-Pacific region should be peacefully resolved through direct dialogues and negotiations by parties concerned.
Steel producers in Europe are concerned about low-priced Chinese imports flooding their markets, saying this has led to a collapse in prices.
The dialogue has both a “Strategic Track” and an “Economic Track”.
China and the U.S. have common interests in the region and should maintain frequent dialogue, cooperate more, tackle challenges, and “cultivate common circles of friends” rather than “cultivate exclusive circles of friends”, Xi said.
Many European nations share those concerns, arguing that their markets are far more open to Chinese investment than China is for their companies, in anything from banking to automobile manufacture. There are real questions about whether each side can manage their own teams and implement what they agree to.
The US has urged Beijing to tackle its excess industrial output and halt the flooding of cheap Chinese imports into overseas markets.
Lou also said China can not impose any hard quotas on steel capacity given that more than 52 percent of steel firms are privately owned.
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“It’s not scary to have disagreements”, Xi said.
