MEDIA REACTION: TAIWAN, CHINESE ECONOMY, GEITHNER'S VISIT,

UNCLAS SECTION 01 OF 02 BEIJING 001294

DEPARTMENT FOR INR/R/MR, EAP/CM, EAP/PA, EAP/PD, C
HQ PACOM FOR PUBLIC DIPLOMACY ADVISOR (J007)
SIPDIS

E.O. 12958: N/A
TAGS: OPRC KMDR CH PREL ECON

SUBJECT: MEDIA REACTION: TAIWAN, CHINESE ECONOMY, GEITHNER'S VISIT,
WESTERN CRITICISM ON CHINA

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Editorial Quotes
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1. TAIWAN

"Time the U.S. eschewed its faulty Taiwan policy"

The official English-language newspaper China Daily (05/14): "Some
scholars credit the TRA for the positive developments in Sino-U.S.
and cross-Straits ties. This is ridiculous, coming as it does on the
30th anniversary of the U.S. Congress passing a controversial bill.
Washington's Taiwan Relations Act (TRA) has been the biggest hurdle
in deepening the U.S.-Sino ties. The TRA says that the U.S. would
fulfill its 'security commitment' made to the island in case of
emergency. The TRA was a big step backward for the U.S. from its
decision to normalize ties with the PRC. In passing the bill, the
U.S. not only interfered with China's internal affairs but also
infringed upon its sovereignty. Sino-U.S. ties have no doubt moved
forward, but strategic misgivings still exist between the two sides.
Washington is worried that Beijing could pose a threat to its
dominant role in East Asia, and the world beyond, if it becomes more
powerful. And the existence of the TRA makes Beijing justifiably
fear Washington would play the Taiwan card to check its development.
The TRA has long been an obstacle in Sino-U.S. ties, and it's time
it was given its long due burial so that bilateral relations can be
taken to a higher level."


2. CHINESE ECONOMY

"Chinese model and the doctrine of mean"

The official English-language newspaper China Daily (05/14): "As the
economic crisis batters the world, many experts have started to
debate economic models. First, the Chinese economy seems to be more
robust than others despite the financial tsunami. Second, the means
used by China to fight the crisis have generated curiosity. Though
the Chinese government's approach seems to have no substantial
difference that those of others, it has been more effective till now
than the way chose by western governments. Third, people are
forecasting the role of China in the future global economic order.
China's capacity to cushion the impact of the crisis, its means to
recharge the economy and its role in recharging the new global
economic order are closely related to the economic model China has
followed for the past three decades. That's why so many people are
interested in the Chinese model. Many developing countries want to
learn from China, while the developed ones worry that the Chinese
model could become the alternative one to that of the west. I think
the Chinese model is a composite or mixed economic system. Its
features include a mixture of ownerships, a combination of foreign
and domestic demands, and the balance between the State and the
market. The Chinese economic model combines the forces of the State
and the market both. Before the reform and opening up, China used to
be a planned economy where the State was omnipresent. The financial
sector is an example of how China has maintained a balance between
the State and the market.But despite its merits, the Chinese model
has its faults, especially in its threadbare social safety net,
which requires painstaking work to build. China needs to learn a
lesson from the global financial crisis, and continue to improve its
model by following the doctrine of mean."


3. GEITHNER'S VISIT

"The U.S. Treasury Secretary is coming to China to test the
situation"

The official Communist Party international news publication Global
Times (Huanqiu Shibao)(05/14): "Although the U.S. was the first
country to transfer the H1N1 virus to China, the officials will not
wear masks when they meet new Treasury Secretary Geithner. Geithner
is the second senior official of the Obama administration, after
Hillary Clinton, to visit China. At the beginning of the year, he
criticized China for manipulating their exchange rate. However, in
the last few months his attitude has mellowed. China being
Geithner's first stop makes Japan jealous. It is expected that
Geithner will pressure China during the visit. Chinese experts have
stated that China should establish rules when dealing with Geithner.
For some of the selfish requests of the U.S., China should
confidently turn them down. Geithner's visit to China has worried
Japan. A Chinese professor indicated that Geithner may bring up
purchasing American bonds, but as Treasury Secretary, he may not
mention human rights issues. The interests of the U.S. and China
are closely connected. Any help exchanged between the two should
not be one-sided. Chinese experts indicate that China should take
the chance to inform the Secretary that China's economic situation
is not as good as it looks. 'An old fox' could describe Paulson,
and a 'little mule' could describe Geithner. China should mention
the RMB issue even before Geithner mentions it, asking him if any

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currency is able to continuously rise and never fall. China's
foreign trade system can't sustain itself if the RMB continues to
appreciate."


3. WESTERN CRITICISM ON CHINA

"Western media is polite to China"

The official Xinhua News Agency international news publication
International Herald Leader (Guoji Xianqu Daobao)(05/14): "This
year, China is realizing that the Western media is criticizing China
less often. The west is calming concerning China's issues. The
Chinese government has become more open and confident in leading
international opinion and dealing with the western media. Chinese
officials have changed their concepts concerning silence. They have
begun to take initiative to explain China to the world positively
guiding international opinion. The President of People's Bank of
China, Zhou Xiaochun, once brought forward the idea of a
'super-sovereign currency' on the internet. It is a rarely-seen
move by the Chinese government to take initiative and establish the
global public agenda. China should realize that improving China's
image is still a long way away."

WASHINGTON