Bush To Offer Both Praise And Criticism Of Chinese President At Asia-Pacific Gathering

SYDNEY, Australia (AP) _ President Bush plans to deliver a mixed message of encouragement and concern when he meets with Chinese President Hu Jintao, the leader of one of the world's fastest-growing

Wednesday, September 5th 2007, 11:30 am

By: News On 6

SYDNEY, Australia (AP) _ President Bush plans to deliver a mixed message of encouragement and concern when he meets with Chinese President Hu Jintao, the leader of one of the world's fastest-growing economies and one of its most formidable military powers.

Bush and his aides say he's eager to talk to Hu on Thursday about increasing trade and climate control and to express satisfaction with Beijing's role in pressing North Korea to agree to disavow nuclear weapons. But he's also ready to discuss product-safety issues following a rash of recalls in the United States, and to register his worries about China's exchange rate policies.

Bush will also urge the Chinese leader to be more aggressive on Iran, raise the issue of jailed dissidents, press Hu on the humanitarian crisis in Darfur and on the treatment of the Dalai Lama, administration officials said. He may even bring up unsubstantiated reports that China's military has hacked into Pentagon computers.

``Our relationship with China is complex,'' Bush said Wednesday.

Ahead of his meeting with Hu, Bush planned a private meeting with Australian opposition leader Kevin Rudd, who is trying to unseat Prime Minister John Howard, a Bush ally in the Iraq war. Bush warmly praised Howard on Wednesday as the Australian leader vowed during their joint news conference to keep Australia's roughly 1,600 troops in Iraq until improved ground conditions justifies withdrawals.

By contrast, Rudd has promised to pull troops out of Iraq if elected.

There was to be little press coverage of Bush's meeting with Rudd, in contrast to the extensive coverage of his sessions with Howard _ which included a picture-taking session during a morning meeting, the news conference, a boat ride, the two leaders' lunch with Australian troops, and Bush's arrival for dinner with the prime minister.

After Howard, the host of this year's 21-nation Asia Pacific Economic Cooperation forum, Hu is the first foreign leader Bush was meeting with on the sidelines of the annual conference, underscoring the importance the U.S. places on China's relationship with the region.

Hu arrived in Sydney on Wednesday and will meet with Howard before his late-afternoon Thursday meeting with Bush. China and Australia are seeking closer economic and defense ties.

Bush suggested China could help reduce trade imbalances and allow its currency to be more responsive to market influences.

``We still have got a huge trade deficit with China, which then causes us to want to work with them to adjust _ to let their currency float,'' Bush said. ``We think that would be helpful in terms of adjusting trade balances.''

Dan Price, a presidential international economic adviser, said ``a whole range of economic issues, bilateral issues with China, are obviously on the table, and would naturally be subjects of discussion between the two presidents.'' Exchange rates are ``a very important issue'' to both countries, he said.

Analysts say China's yuan is undervalued, giving Chinese exporters an unfair advantage despite China's steps to revalue the currency by 2.1 percent in 2005 and then letting it appreciate a further 7.3 percent.

U.S.-Chinese tensions have also grown over the issue of defective products. Just Wednesday, Mattel Inc. announced a third major recall of Chinese-made toys in little more than a month because of excessive amounts of lead paint. The world's largest toy maker said the move affects about 800,000 toys.

China has denied reports that its military hacked into a computer system in the office of Defense Secretary Robert Gates in June. Bush largely sidestepped the question, but said, ``We understand that we're vulnerable in some systems.'' The Financial Times, citing unidentified officials, said China was behind the attack that forced the Pentagon to temporarily take down the network. China has called the allegations ``groundless.''