I have recently returned from a trip to China sponsored by the China-United States Exchange Foundation (CUSEF) and the China Association for International Friendly Contact (CAIFC). On the trip with me were four Former Members of Congress, all of whom have outstanding records and greatly contributed to the success of the trip. They were Congressman Jay Rhodes (R-AZ), Congressman Dennis Hertel (D-MI), Congressman Bill Zeliff (R-NH), and Congressman Sam Gejdenson (D-CT). This report and any errors in this report are mine although I believe that all five of us agreed on much of what is written. I have asked them to send me their thoughts which I have included in these summaries.

9. Meeting with Ministry of Foreign Affairs Vice Minister Cui Tiankai(former Ambassador to Japan). The Minister had studied in the States and had a tremendous background and obviously spoke English well. The Minister in his opening remarks stated:
Cui: We are moving back on the right track for relations. In late May we will have SED II conversations with Clinton, Geithner, etc in China. In June we have G-20 Summit, presidents will likely meet. As long as both sides work together, we can have sound and stable development of bilateral relations.

Several weeks ago, presidents had a long phone conversation.[Regarding currency] Geithner will stop in Beijing today for an hour on his way back to US. For issues like currency, better to be discussed between relevant agencies than between the press. Value of any currency is determined by a variety of factors.

Very surprising sometimes how perceptions can be different across the Pacific. Understand the difficulties that the US economy is having and the sentiments of the unemployed. China has the same issues though. Unemployment rate is relatively high, have a different way of collecting the statistics. Many people have only temporary jobs, which worries Chinese government. Also is their number one priority. Not just an economic issue, also a social issue. Important to understand situation on both sides. Our US-China relationship in trade is complicated and important. For March, China may have a national trade deficit for the first time. But in services, US has a surplus over China. Import of Chinese products creates jobs in US – shipping, handling, retailing, etc.—some people might lose jobs to China, but also many other countries. On other hand, other people would gain new jobs. This is a two-way street. Some Chinese workers are losing jobs due to the US. Example: Because of Chinese purchase of Boeing planes, one Chinese SOE that built airplanes had to shut down, Cui’s brother lost his job creating planes and now maintains US-built planes. Chinese products that US imports are of good quality and are cheap, helps the American consumer. Even if US doesn’t import from China, won’t re-start production in US, will import from elsewhere. Will not help US to reduce deficit solely by putting some limits on Chinese imports. US has to do some restructuring economically. Chinese don’t want to continue to seek continued surplus of foreign exchange reserve, it is not sustainable, puts huge pressure on monetary policy. Want more balanced trade, want to buy more as a country. Some things Chinese want to buy, US does not want to sell. If you are ready to sell more, we are ready to buy more. For any country, monetary policy is part of sovereignty. On other hand, understand that in age of globalization every country is interdependent. Our ties are very strong, we only have choices of win-win or lose-lose.

Frey: There are other issues out there that we need to work together on, like Iran and North Korea. No one is really sure what is going to happen. US-China working together improves chances of preventing negative action. Believe that clock is ticking in Iran, if they develop a nuclear capability, Israelis may attack regardless of what we say. US-China working together more visibly and aggressively on these issues would help the economic situation. Last thing we need is the US Congress to jump in full bore on the currency issue due to elections. Much more difficult if China is not a visible partner on major foreign policy issues. Would help appease the press, who have a big say. Need momentum in the international areas.

The issue of Iran came up.

Cui: On Iran, all share the concern about the prospects of the emergence of another nuclear weapons state. That is why we are working together on this issue. Want to strengthen non-proliferation regime. This region is very important for its oil. Want to see peace and stability in Middle East, no nukes. China is the only nuclear weapons state surrounded by so many other nuclear weapons states and threats, China’s own security is at stake. Sometimes we might differ on tactics, though. We all believe that we should strengthen the non-proliferation regime and stop the Iranians from getting nuclear capability. But what is the most effective means? Agree on two tracks: negotiation and dialogues, and Sec Council sanctions. But still, dialogue and negotiations would be preferable and more effective. History of Sec Council sanctions, most of the time they just don’t work. Important for political pressure and showing strong will of international community. But only useful to a certain extent. Later today, Chinese ambassador to UN will be in new discussions of this issue. On North Korea, its on China’s doorsteps. Why they have made such tremendous efforts on six-party talks. Cui has worked on nuclear issue with both Iran and NK in the past. We all share the same goal of international stability and non-proliferation, but have different perceptions of the tactics. Maybe the different countries’ perceptions could be complementary. Important for major players to work together.

Do appreciate your visit, and hope to have more contacts with your Association. Your Association can serve as a bridge. You are in a better position to learn more and communicate better with others. Would like to have more meetings with current Congressmen. They don’t enjoy a strong reputation for their knowledge of China, hope they can come to China and learn for themselves and refrain from making remarks that sound ridiculous to Chinese. Chinese chatrooms are very critical of such comments. This is what accountability is all about. We are getting more and more similar to each other. Public opinion is increasingly powerful in China.