Bush Meets Chinese President

The Chinese president, Hu Jintao, met his US counterpart George Bush today, in a first official visit to Washington that comes amid tensions over trade, human rights and the status of Taiwan.

A Falun Gong protester broke through security cordons to heckle Mr Hu during his opening speech, saying that his "days are numbered".

Other supporters of the spiritual movement gathered around Washington, banging gongs and waving banners accusing Mr Hu of genocide and running labour camps.

Mr Bush admitted the difficulties in the US-China relationship during his welcoming speech on the White House lawn.

"As the relationship between our two nations grows and matures, we can be candid about our disagreements," he said. "We will address our differences in a spirit of mutual respect."

Mr Bush called on China to expand access to its markets for American companies, in words that will provide comfort for factions in Washington pressing for protectionist measures to restrain China's booming economy.

"The US and China are two nations divided by a vast ocean yet connected through a global economy which has created great opportunities for both our peoples," he said. "Our two nations share an interest in expanding free and fair trade."

Mr Hu dedicated a large portion of his speech to an unusually strong reiteration of Beijing's "One China" policy, which holds that Taiwan is a breakaway province of China rather than an independent state.

The US and UN both officially support the policy, but the Bush administration has occasionally raised hackles in Beijing by its insistence that Taiwan's status cannot be resolved by military means.

The pair will hold talks later today, but analysts do not expect much formal progress from the meeting, given the welter of divisive issues between the two governments.

Elizabeth Economy, director for Asia studies at Washington's Council on Foreign Relations, said that Mr Hu's wanted to demonstrate China's increasing status by showing that he could be treated as an equal by Mr Bush.

"It's important as a reaffirmation of the relationship. Both President Bush and President Hu are committed to stability in the relationship and to moving forward," she said.

The tensions over the meeting even extended to arcane issues of protocol, with US and Chinese officials differing over whether to regard the trip as an official visit - as Washington describes it - or a state visit, a more distinguished title preferred by Beijing.

A law put before the US senate last month would impose tariffs of up to 27.5% on Chinese imports to force Beijing to revalue its currency, a move which some critics see as crucial to closing the yawning trade gap between the US and China.

The US currently imports $202bn (£113bn) more goods and services from China than it exports to the country, the largest deficit the US has ever recorded with another country.

US critics claim the imbalance has led to a loss of more than three million US manufacturing jobs since 2001, and say the Chinese government is exacerbating the problem by keeping its currency undervalued against the dollar.

China's central bank introduced a limited "managed float" of the Yuan last July, since when it has gained more than 3% against the dollar.

But US critics say it is still valued around 40% too low, and want the Yuan to be freely floated on international currency markets.

The wider concern is China's emergence as a world economic power. By some measures China is now the world's second-biggest economy, $8,200bn compared to $12,400bn for the US, and some estimates even expect it to overtake the US some time between 2015 and 2050.

Official figures released today show China's economy growing by 10.2%, prompting a spokesman for the country's official statistics bureau to voice fears about the economy overheating from the rate of export-driven growth.

Mr Hu's visit to the US capital came after a two-day trip to Washington state in the Pacific north-west, where he visited iconic US businesses including Boeing, Microsoft and Starbucks.

China's interests are well illustrated by the fact that Mr Hu spent as long visiting American businesses as he will spend visiting the US government, and by the fact that he will continue his world tour with visits to Saudi Arabia and Nigeria to discuss energy cooperation.

China's sensitivity over Taiwan is likely to have been heightened by a carefully-timed series of moves by Taiwan's president Chen Shui-Bian today.

He met five Chinese pro-democracy campaigners and authored a comment article in the Wall Street Journal Asia stating that China's increasing strength necessitated compensating moves by Taiwan. The guarded remarks could be interpreted as accepting an increase in political tensions between the countries.

Other issues likely to be on the table at the meetings include restraining apparent attempts by North Korea and Iran to acquire nuclear weapons, tackling China's human rights record on freedom of speech and freedom of religion, and clamping down on copyright piracy by Chinese companies.