NEW: Geithner emphasizes expanding trade and investment
Discussions are expected to cover tensions over possible sanctions on Iranian oil exports
China says its large imports of Iranian oil have nothing to do with Tehran's nuclear program
Officials also talk about improving economic ties between China and the United States
U.S. Treasury Secretary Timothy Geithner met Chinese leaders on Wednesday with discussions expected to focus on cooperation between the world’s top two economies to bolster global growth as well as possible sanctions on Iranian oil exports.
Geithner held talks Wednesday with Vice President Xi Jinping — tipped to become China’s next president later this year— and Vice Premier Li Keqiang.
He was scheduled to meet Prime Minister Wen Jiabao later Wednesday.
Geithner met with his counterpart, Vice Premier Wang Qishan, on Tuesday night and pledged cooperation on global economic issues.
China and the United States “have a lot of issues to talk about in the areas of economy, finance, trade and investment,” Wang said at a news briefing on Tuesday.
While China has called on the United States to loosen export regulations, Washington has said that Chinese currency controls keep the yuan undervalued and give Chinese exporters an unfair advantage at a time when the global economy is suffering.
In Geithner’s meeting with Vice Presiden Xi on Wednesday morning, he emphasized the expansion of trade and investment with China.
“We are looking forward to exploring opportunities to expand our exports to China and to strengthen and deepen our cooperation with China on a broad range of economic and strategic issues we face around the world,” said Geithner. “On economic growth, financial stability around the world, on nonproliferation, we have what we view as a very strong cooperative relationship with your government and we are looking forward to building on that.”
Tensions between Tehran and Western powers over possible sanctions on Iranian oil were also expected to be on the agenda in Beijing.
Iran threatened in late December to block the Strait of Hormuz if sanctions were imposed on its oil exports. France, Britain and Germany have all proposed such sanctions to punish Iran for lack of cooperation on its nuclear program.
The strait is a critical shipping lane, through which 17 million barrels of oil passed per day in 2011, according to the U.S. Energy Information Agency.
China relies on imports for half of the oil it consumes, buying nearly one-third of Iran’s oil exports. Beijing has said that its imports have nothing to do with Tehran’s nuclear program and rejects new U.S sanctions on foreign financial institutions that conduct business with the Central Bank of Iran.
China, the world’s biggest energy consumer, has supported U.N. sanctions on Iran’s nuclear program, but says the decisions should be multilateral.
Wen is scheduled to visit the oil-rich regions of Saudi Arabia, the United Arab Emirates and Qatar this coming weekend, China’s foreign ministry said Tuesday.
Despite the high-level meetings, experts say China is unlikely to budge on the most sensitive issues anytime soon, especially with Washington’s recent military strategy report that focuses on Beijing’s economic power as a potential threat to U.S. security.
“China wants to cooperate with the U.S., but one visit by Geithner is not going to make a huge difference,” said Zhao Kejin, a professor at Tsinghua University’s Institute of International Studies. “Currency, trade and Iran are huge issues that require more in-depth dialogue before we see results.”
After his meetings in China, Geithner will travel to Japan and hold talks with Prime Minister Yoshihiko Noda and Finance Minister Jun Azumi on Thursday.