Aug 23, 2011


Biden Calls for Closer Ties with China to Boost Market Confidence

  • Aug 23, 2011
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  • US Vice President Joe Biden met Chinese Vice President Xi Jinping, expected to succeed Hu Jintao as President from early 2013, on Wednesday this week to seek building confidence in order to boost global market. Biden's five-day visit to China is about reducing distrust, not striking deals, and he also focused on shoring up optimism about U.S. power and prospects for Sino-American relations. And both great nations believe that they can find a common ground to rebuild the faith in the dollar.

    Even though Mr. Xi expressed confidence in American economic prospects and did not voice concern about U.S. debt, Beijing wants Biden to assure it that its vast holdings of dollar assets and U.S. Treasury debt remain safe, despite Standard & Poor's downgrade this month of the sovereign credit rating of the United States. Analysts estimate Beijing has put two-thirds of its $3.2 trillion in foreign exchange reserves, the world's largest, in dollars and is the biggest foreign creditor to the United States.

    Mr. Xi will boost his profile through meetings with Biden and a visit to the United States, possibly in early 2012. He will also have to show he can navigate minefields in relations. However, the main challenge for both countries to deal with is the concern on issues of Taiwan and Tibet.

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