Monday, November 26, 2007

Sarkozy Presses China on Currency

French President Sarkozy Emphasizes Currency, Environment on Visit to China.

French President Nicolas Sarkozy kicked off his first state visit to China Sunday by urging the Communist leadership to let its currency rise before Beijing's trade imbalances become unmanageable. "A great country must have a strong currency," Sarkozy told Chinese and French business leaders in a speech at a Beijing hotel. He called for a "fair balance between the major currencies -- the dollar, the euro, the yen or the yuan."

China says it is committed to the gradual reform of its currency, the yuan, but critics charge it remains undervalued, making Chinese products unfairly cheap and boosting its trade surplus with France and the rest of Europe. "China has an important role to play, in consultation with the other players, in not letting imbalances accumulate to a point where we won't know how to get out of them," Sarkozy said.

Sarkozy's three-day visit was expected to focus on economic ties with China while playing down human rights concerns that would be sure to receive a cool reception from Beijing. However, at a dinner Sunday with President Hu Jintao, Sarkozy gently urged China to apply the death penalty less frequently, the French presidential Elysee palace said.

"I am not asking for it to be abolished completely, but to accentuate the tendency that is taking shape quite naturally," the Elysee quoted the French leader as saying. Hu responded that he hoped "to have things evolve" in such a way as to "reduce the number of cases in which the death penalty is applied," the Elysee said.

The French leader also asked for freedom for journalists working in China, it said. Hu did not make any precise pledge in response, it said. Paris-based advocacy group Reporters Without Borders had earlier appealed to Sarkozy to raise the cases of 33 journalists and 50 cyberdissidents imprisoned in China.

Sarkozy said after the meeting that he had also urged Hu to "engage vigorously" in finding a solution to the crisis in neighboring Myanmar, where the ruling junta violently suppressed pro-democracy protests in September. "If there is a country that can change" things on the ground in Myanmar, "it's obviously China," he said.

The Elysee compared the Sarkozy-Hu meeting to a "nice pingpong" game, with the leaders politely batting ideas back and forth.

During his speech to business leaders in Beijing, Sarkozy also warned of the costs of China's five consecutive years of double-digit economic growth, saying that development must not deplete natural resources or accelerate global warming. "Chinese growth must not and cannot happen at the expense of the world environment," Sarkozy said. "If not, what would be the good of developing?"

Sarkozy also addressed the widespread counterfeiting of products in China, including famous French brands such as Louis Vuitton and Christian Dior, saying China, as a "great economic power," has every interest in respecting the rules of world commerce.

Sarkozy's formal meetings with Chinese officials were to start Monday. Aides said Sarkozy would focus on the environment, commercial ties, Africa, China's international role, and bilateral concerns. France's concerns about Iran's nuclear programs are also expected to feature in discussions, especially support from Paris for new U.N. sanctions against Tehran that Beijing has opposed.

Sarkozy's trip comes about one week before a visit by European Union leaders to lobby China to lower barriers to imports and foreign investment and ease currency controls. China's European trading partners complain that Beijing is violating World Trade Organization commitments by trying to nurture Chinese companies at the expense of foreign rivals.

Sarkozy's arrival in Beijing was preceded by a brief trip to the former imperial capital of Xi'an in western China to view the famed terra cotta army of China's first emperor. He will fly to Shanghai on Tuesday before leaving for Paris that night.

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