But while the agenda covered a wide variety of issues — from trade imbalances to climate change to the nuclear efforts in Iran and North Korea — the talks wrapped up with few concrete results. Instead, the high-level discussions seemed designed to forge a new tone for a bilateral relationship that has been tenuous at times in recent years.
Officials appeared upbeat that the meetings fostered connections that will serve them well in the future.
“[L]aying this groundwork may not deliver a lot of concrete achievements immediately,” Secretary of State Hillary Clinton told reporters Tuesday. “But every step on this path to create confidence and understanding is a very good investment.”
Economic issues dominated the talks. In a statement opening the summit, President Barack Obama said, “The current crisis has made it clear that the choices made within our borders reverberate across the global economy – and this is true not just of New York and Seattle, but Shanghai and Shenzhen as well.”
For its part, the U.S. delegation, which included Treasury Secretary Timothy Geithner, pledged to eventually rein in the ballooning U.S. budget deficit, which could threaten the value of the dollar and thus the value of China’s $1.5 trillion-plus in U.S. debt. Earlier this year,China’s Premier Wen Jiabao expressed concern about China’s massive holdings of U.S. Treasuries. China, for its part, said it would to continue to encourage domestic-led growth, rather than a heavy reliance on foreign demand for its goods. The two sides also agreed to strengthen trade and investment ties between the two countries and to work together to create a stronger and more sustainable global financial regulatory system.
“Credible steps will be taken by the U.S. to control the deficit,” China’s Finance Minister Xie Xuren told reporters. “The Treasury secretary stated clearly that they are placing a lot of importance on this issue.”
But for all the talk of mutual respect at the news conferences, contention appears to remain on key issues. Little was said, for instance, about the value of the Chinese yuan, which some U.S. manufacturers and lawmakers believe is kept artificially low for trade purposes. The North Korean nuclear program was a key item on the agenda, but it was unclear whether the Chinese agreed to increase pressure on the isolated state. And little progress was made on climate change, with China refusing to commit to targets for reducing greenhouse gases.
Even the areas of agreement lacked much substance, according to analysts. “It was all backward rhetoric,” says Simon Johnson, a senior fellow at the Peterson Institute for International Economics. “It was, ‘we’ll save more, you’ll save less.’ They’ve been saying that for five years.”
The talks follow trips to China this year by both Clinton and Geithner. The two countries pledged to meet for a counterterrorism summit this fall and to reprise the economic and security meetings next year.
The talks this week preview many of the difficult discussions that will take place during the September G20 summit in Pittsburgh. “The G20 is where the action is,” says Johnson, adding that getting countries to agree on the specifics of a stronger financial regulatory system will be the key issue to watch.