BEIJING — The U.S. Treasury secretary, Timothy F. Geithner, said Thursday that allowing the renminbi to appreciate was as important to reshaping China’s economy as opening its markets was in the 1970s.
“A stronger, more market-determined” renminbi would “reinforce China’s reform objectives of moving to higher value-added production, reforming the financial system and encouraging domestic demand,” Mr. Geithner said during talks here between the United States and China. “Future economic growth will require another fundamental shift in economic policy.”
Zhou Xiaochuan, the governor of the Chinese central bank, said the market had “its own power to correct” any imbalances in the exchange rate. Mr. Zhou said he thought there were “no big differences” in the U.S. and Chinese positions on the renminbi even as they chose different words on the topic.
Commerce Minister Chen Deming said the exchange rate had little effect on China’s trade surplus with the United States, instead blaming U.S. export controls. Referring to the easing of such controls, Mr. Chen said, “I hope I have enough patience for such a day.”
Prime Minister Wen Jiabao and the Communist Party are trying to tilt growth more toward consumption and away from exports and investment, while gradually loosening controls on financial markets and the renminbi, without harming their grip on power.
In opening remarks at the talks, Mr. Geithner said, “The United States has a strong interest in the success of these reforms, as does the rest of the world.”
In separate comments at an economic session, he said increasing the value and relaxing controls on the renminbi would “provide China the independence and flexibility to respond to future changes in growth and inflation.” Mr. Geithner highlighted the currency’s 13 percent gain over the past two years as a sign of progress by China.
Mr. Geithner and Wang Qishan, a deputy prime minister, called for deeper cooperation between the United States and China. Mr. Wang said that the global economic situation remained “complicated and severe” and that the nations had “continuously deepened relationships” in trade and investment while dealing hand-in-hand with the financial crisis and European debt turmoil.
“We must continue,” Mr. Wang said, “to enhance coordination of macroeconomic policies, work together to meet global challenges, and ensure economic growth and job creation in both our countries so as to contribute to a strong and sustainable recovery of the world economy.”
He called on the United States to “take concrete steps to relax control on high-tech exports to China, expand infrastructure cooperation, increase financial market access and avoid politicizing economic issues.”
Beijing’s steps toward letting the renminbi trade more freely include giving markets a bigger role in setting the exchange rate. On April 16, the central bank widened the currency’s trading band against the dollar to 1 percent from a daily range of 0.5 percent in place since 2007.
Mr. Geithner, during a speech last week outlining U.S. objectives in China, called on Beijing to loosen control of its financial system and to raise the ceiling on deposit interest rates.
Last month, the United States delayed a report on the exchange-rate policies of trading partners, including China, until after global meetings including this week’s sessions in Beijing. The U.S. Treasury Department frequently delays the report. The last one, due on Oct. 15, was released on Dec. 27. The previous one, due on April 15, 2011, was released on May 27.
The Obama administration says China uses an undervalued currency to give its exporters an unfair advantage in overseas markets. In the December report, the Treasury called for China to adopt “greater exchange-rate flexibility” while declining to brand it a currency manipulator.
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