Monday, October 25, 2010

Taking Harder Stance Toward China, Obama Lines Up Allies

WASHINGTON — The Obama administration, facing a vexed relationship with China on exchange rates, trade, and security issues, is stiffening its approach toward Beijing, seeking allies to confront a newly assertive power that officials now say has little intention of working with the United States.

In a shift from its assiduous one-on-one courtship of Beijing, the administration is trying to line up coalitions — among China’s next-door neighbors and far-flung trading partners — to present Chinese leaders with a unified front on thorny issues like the currency and its territorial claims in the South China Sea.

The advantages and limitations of this new approach were on display last weekend at a meeting of the world’s largest economies in South Korea. The United States won support for a concrete pledge to reduce trade imbalances, which will put more pressure on China to allow its currency to rise in value.

But Germany, Italy, and Russia balked at an American proposal to place numerical limits on these imbalances, a step that would have further upped the ante on Beijing. That left the Treasury secretary, Timothy F. Geithner, to make an unscheduled stopover in China on his way home from South Korea to discuss the deepening tensions over exchange rates with a top Chinese finance official.

Administration officials speak of an alarming loss of trust and confidence between China and the United States over the last two years, forcing them to scale back hopes of working with the Chinese on major challenges like climate change, nuclear nonproliferation, and a new global economic order.
Read the rest here.

It's not often I have something positive to say about this administration. But this seems like a good move to me.

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