China said to buy $12.5b in US goods

(AP)
Updated: 2007-04-02 15:38

China has drafted a plan to buy US$12.5 billion worth of US goods including electronics and soybeans, a news report said Monday, in a possible effort to ease tensions ahead of a high-level meeting on trade disputes.

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The purchases would be made in May, Dow Jones Newswires said, citing an unidentified person familiar with the plan. That would coincide with the next round of a US-Chinese dialogue on economic disputes due to be held in Washington.

Tensions flared Friday when the United States announced duties on Chinese paper imports, accusing Beijing of improperly subsidizing its producers. China criticized the tariffs and demanded that Washington reverse the decision.

The economic dialogue is led by US Treasury Secretary Henry Paulson and Chinese Vice Premier Wu Yi. Paulson has warned that it must produce short-term results to mollify American critics of Beijing's growing trade surplus.

Under the proposed plan, China would buy US$10 billion worth of mechanical and electronic goods, US$2 billion worth of soybeans and US$500 million worth of cotton, Dow Jones reported.

Phil Laney, the China country director for the American Soybean Association, said he expects Chinese purchases ahead of the May meeting but could not confirm the reported plan.

"We think it's true, but I couldn't tell you details," he said.

Spokespeople for China's Commerce Ministry and cabinet news office did not immediately respond to requests by phone and fax for comment.

Last year, China announced deals to buy US$16.2 billion worth of Boeing jetliners, soybeans and other US goods in an apparent effort to ease trade tensions before President Hu Jintao visited the United States.

Laney said delegations from China's machinery, cotton and poultry industries were expected to travel with Wu to Washington.

Soybeans are the biggest single US farm export to China, which has bought about 11 million tons worth US$2 billion since the current market year began in September, Laney said. The beans are crushed for oil and used as animal feed.

"The Chinese government understands that soybean exports from the US are very important to us," he said.

The US measures announced Friday would impose preliminary tariffs of 10.9 percent to 20.4 percent on imports of Chinese sheet paper.

China criticized the decision as a violation of a pledge by American and Chinese leaders to settle disputes through dialogue.

"China strongly urges the US to reconsider the decision and to correct it as soon as possible," Commerce Ministry spokesman Wang Xinpei said Saturday.

 



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