I think it is quite important and in particular what it shows is that engagement with China can work. And that’s what we are attempting to do in this strategic economic dialogue and many other issues that are being discussed. This is one item that was led by US trade representative ambassador Susan Schwab addressing concerns that we have with respect to Chinese subsidies, particularly export subsidies and subsidies we would say that you need to…that a Chinese company would need to import domestic goods as opposed to imported goods. But this really does show that when we have a chance to work through the issues and to work on them collaboratively that we can get a mutually beneficial result. I think that’s in particular the significance here.

But you've got some very very big issues indeed to deal with. You've got the issue of Chinese respect of intellectual property, you got the issue of China’s opening up its market to international financial services, and above all you've got the fact that the Chinese, said in newer estimation, keep their currency the RMB yuan artificially low against the dollar. It’s ganna take a long time, isn’t it, to get real progress on those issues?

Well, some of these issues are ones that we are able to make progress on. That’s the focus of what we call our strategic economic dialogue to be able to address the long-term strategic issues that we really need to be able to address over the long term. These are issues like energy and the environment, issues on, as you indicate, getting them to appreciate their currency more rapidly. All the issues with respect to having them accelerate the development of their financial sector, issues on investment, issues for example on integrity of trade consumer protection and product safety. So those are all issues… (Let's) Please go ahead Charles

Yes, Sorry, ambassador I mean those are obviously, don’t let's get in too far down the laundry list. I mean, those are all important issues but the fact is sure you don’t have that much leverage—the Chinese sell an enormous number of goods that people in America want to buy, hence the deficit on the one hand; on the other hand, you would be very worried if the reserves that the Chinese are holding in dollars were suddenly to go over to Euros or some other currencies essentially they've got all the leverage, you don’t have much, right?

Well, I think there are two important pieces of leverage those apply with respect to America, they also apply with respect to Europe. And that is continued access to those two markets which is something that the Chinese certainly are very interested in. The other piece of leverage is all of these questions are once where the Chinese do recognize. That it's important for them on consumer product safety to protect the Chinese brand. They recognized that it is important for them to move to a more flexible exchange rate and what we are focusing on with them is not so much the direction of reform but the pace of reform.

Notes:

with respect to: pertaining to, concerning...