胡锦涛主席访美专题报道

Chinese leader focuses on business as four-day US visit begins
New York TimesPosted online: Thursday, April 20, 2006 at 0000 hrsBeijing has treated close ties to American business leaders vital because the two countries are integrated more economically than politically
SEATTLE, April 19: Chinese president, Hu Jintao, began courting major American business leaders on Tuesday, kicking off a four-day United States tour intended to soothe qualms about China’s surging trade surplus and rising political power.

Hu, who on Thursday will make his first visit to the White House since becoming China’s top leader more than three years ago, landed in Everett, Washington, north of Seattle, and plunged into meetings with local officials and business executives, including Gov Chris Gregoire and the Starbucks chairman, Howard D. Schultz.

He later visited the headquarters of the software giant Microsoft in Redmond, and his evening plans included dining with local dignitaries at the Medina mansion of Bill Gates, the company’s chairman. On Wednesday, Boeing will be his host at its aircraft factory in Everett.

At Microsoft headquarters, Hu lavishly praised the company. Microsoft has struggled to find a firm foothold in China, which is widely accused of pirating software on an industrial scale, but has recently signed deals with Chinese companies that could lead to a sharp increase in sales of its Windows operating system. ‘‘I admire what you have achieved at Microsoft,’’ Hu told Gates in front of reporters. ‘‘You, Bill Gates, are a friend of China, and I’m a friend of Microsoft.’’ He added, ‘‘I am dealing with the operating system produced by Microsoft every day.’’

The business focus follows a tradition set by Deng Xiaoping on his first visit to the US in 1979, when he communed with American capitalists just as China began to shed its Maoist legacy and open up to the outside world.

Beijing has since treated close ties to American business leaders as vital to its overall relations with Washington, because the two countries are much more integrated economically than politically, diplomatically or culturally. Still, direct dealings with corporate leaders is a novelty for Hu, who, unlike his predecessors, almost never meets foreign business leaders in Beijing and remains aloof from the commercial dealings of the Chinese government.

Hu, 63, has made multiple trips to Europe, Russia, East Asian neighbors, and even Latin American and African countries, since assuming China’s top political posts, head of the Communist Party and president, in 2002 and 2003. At least initially he put less emphasis on forging tighter links to the United States, which he has criticized in domestic speeches as a potential threat to China’s ruling Communist Party.

But Chinese officials and analysts say he has since made clear that internal priorities ― maintaining rapid economic growth and tamping down a wave of unrest over corruption, governmental land grabs, and severe pollution ― are better served if Beijing cultivates cordial relations with Washington. ― JOSEPH KAHN

Hu begins US charm offensive

Seattle (dpa) - China's president Wednesday held out the prospect of ordering hundreds more US-made Boeing aircraft, part of a charm offensive ahead of a crucial meeting with US President George W Bush.

Hu Jintao's remarks after visiting a huge Boeing plant near the Pacific Northwest metropolis of Seattle were meant to show Americans that China not only sells to the US, but also buys.

Yet while pledging to increase Chinese consumer demand, he rebuffed US pressure to revalue China's currency - which Washington says Beijing is keeping artificially low to boost exports.

Hu suggested a bounty of billions of dollars worth of contracts for the US aircraft maker, predicting that China would need 600 additional planes in the next five years and possibly a total of 2,000 over 15 years.

In the run-up to Hu's visit, China last week sealed an order for 80 Boeing 737 jets worth 5.2 billion dollars.

In the trip's highlight, Bush is meeting Hu at the White House on Thursday. Bush has called the relationship with China "very positive and complex," but said he would push for "fairness in trade."

Hu on Wednesday praised Boeing's links with China as "vivid example of the ... win-win outcome that China and the United States have achieved from trading with each other."

"I also sincerely hope that the economic and trade relations between our two countries in general will prosper further and fly higher, just like a Boeing plane."

Boeing Co is the world's second largest aircraft maker and one of the largest US exporters in terms of sales.

After his visit to Boeing, Hu stressed the overriding importance of US-Chinese economic ties - even as a House of Representatives hearing in Washington heard criticism of China's human rights record.

"Strong business ties meet the fundamental interests of our two countries and peoples and will continue to play an important role in boosting and stabilizing our relations," Hu said.

The Chinese president arrived in the US on Tuesday for a visit designed to allay US fears over China's rapidly developing economy and its military power.

Raising two critical issues in US eyes, he pledged China's willingness to expand domestic demand to reduce its 200-billion- dollar trade surplus with the US and to crack down on software piracy by enforcing intellectual property rights.

China and the US "are fully capable of settling the problems that have occurred in the course of business growth and keeping their business relations on a sound track," Hu insisted.

But he stopped short of acceding to US demands for a currency revaluation, saying that "China has taken a highly responsible attitude in deciding upon an exchange rate regime suitable to its national conditions".

He portrayed China and the US as partners in "peace and development" in the Asia-Pacific region and beyond.

"Let's join hands, deepen our mutually beneficial cooperation, promote common development, and facilitate the comprehensive development of the constructive and cooperative relationship between the two countries," he said.

On Tuesday, Hu met Microsoft chairman Bill Gates and other local political and business leaders in Seattle for a sumptuous dinner get- together meant to highlight burgeoning business ties between the Seattle region and China.

"Long live the China-American friendship," Hu wrote on a computer in a tour of an educational facility.

At his hotel in Seattle, Hu met earlier Wednesday with former US secretary of state Henry Kissinger, who first normalized ties between the countries in 1972, as well as former National Security Adviser Brent Scowcroft and former Defence Secretary William J Perry.

Hu pledged to keep China on a path of reform that would increase trade with the US.

"Today, many cargo ships are very busy crossing the Pacific Ocean, laden with the rich fruit of our strong trade ties and friendship between our two peoples," Hu said at an official dinner at Gates' 100 million dollar lakeside residence Tuesday evening.

"I am sure that with the further deepening of China's reform and opening up, we are going to see an even broader prospect for the economic cooperation and trade between China and Washington state and China and the United States as a whole."

On a lighter note, Hu asked Gates for help in using Microsoft's Windows operating system and confessed that, were it not for the restrictions of his office, he would be a regular at one of the many coffee shops operated in his country by the Seattle-based chain Starbucks.

Despite the bonhomie, Hu's visit comes against a backdrop of simmering tension over the huge US-Chinese trade imbalance - which has prompted calls for action in the US Congress - and differences over the Iranian nuclear crisis.

On Friday, Hu is due to give a speech at Yale University in New Haven, Connecticut, outlining plans for China's peaceful development.

After concluding his US trip Friday, Hu will continue on to Saudi Arabia, Morocco, Nigeria and Kenya.

Hu begins historic US visit, meets Bill Gates

Agencies
Wednesday, April 19, 2006 23:45 IST


 
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SEATTLE: Chinese President Hu Jintao met Microsoft chairman Bill Gates on the first day of a closely watched visit to the US that takes place against the backdrop of simmering tension over Beijing’s economic power and differences on the Iranian nuclear crisis.

Traditional lion dancers and local dignitaries including Starbucks coffee-chain chairman Howard Schultz greeted Hu after he arrived Tuesday aboard a China Air Boeing 747 at Everett, Washington.

Hu began his stay in the Pacific Northwest ― home to US business powerhouses Microsoft Corp and Boeing Co ― on way to a Thursday meeting with US President George W Bush at the White House.

A sweeping range of topics was on the agenda for the communist leader’s trip, underlining a complex relationship that includes the huge US trade gap with China and the Pentagon’s view of China as a future military rival.

In brief remarks, Hu said that US-Chinese relations were enjoying a “sound momentum of growth”, and that the two nations were shouldering joint responsibility for promoting peace and development.

Hu rode into Seattle for a meeting with Washington state Governor Christine Gregoire. Hu then drove to the nearby campus of software giant Microsoft, where he met Gates and was given a tour of the company’s home of the future ― a house specially designed to incorporate cutting-edge technology. His talks with Gates were also believed to centre on software piracy in China.

Later, Gregoire hosted an official gala dinner for Hu at Gates’ 100-million-dollar lakeside mansion. Ahead of Hu’s visit, Chinese officials sealed $16 billion worth of deals in more than a dozen US states, a business whirlwind designed to soothe US concerns that trade with China is a one-way street.

Conflicts could surface over China’s cautious approach on curbing Iran’s nuclear programme and differing approaches to North Korea. “I intend, of course, to bring the subject up of Iranian ambitions to have a nuclear weapon, with Hu Jintao this Thursday,” Bush said on Tuesday in Washington, pledging to pursue diplomacy on the issue.

China’s currency, which the US claims is being kept artificially low to boost Chinese exports, is another point of friction. The US blames the currency issue for part of the $200-billion trade gap with China last year.

US Commerce Secretary Carlos Gutierrez Tuesday urged Hu to use his visit to blunt calls in Congress and elsewhere for protection against Chinese imports. On Friday, Hu is due to give a speech at Yale University in New Haven, Connecticut, outlining plans for China’s peaceful development.

Bill Gates' message to President Hu
Bill Gates touched on a range of topics during his introduction of Hu Jintao today for the Chinese president's policy speech in Everett. After telling the audience about Hu's background, Gates addressed his comments specifically to Hu. Here are key excerpts from that portion of Gates' comments:

"China has taken great strides over the past two decades to improve its economy, foster remarkable economic growth, and improve the lives of hundreds of millions of people. I applaud your commitment to spread this new prosperity to all of China's people, both urban and rural. Both the United States and China will prosper in an environment of open trade and mutual respect for international norms. China and the United States will flourish in an environment that encourages the exchange of people and ideas. ...

"As you have stated, Mr. President, science and technology are the most important drivers of productivity, and economic and social development. You have said that developments in technology are giving rise to a new round of industrial revolution. We agree with you. We are encouraged by the efforts of the Chinese government to strengthen intellectual-property protection.

"The world is now in a new era where people and governments everywhere are harnessing the power of the Internet, which will have a profound and constructive impact on economic development, education and communications. This new era of the Internet-based economy also presents new challenges to all of us. It is my belief that industry and governments around the world should work even more closely to protect the privacy and security of Internet users, and promote the exchange of ideas, while respecting legitimate government considerations.

"Mr. President, it is our sincere hope that your visit to the United States will increase our understanding of one another, and create a closer and deeper partnership between our governments, our economies, our cultures and our people. ... "

With that, Gates welcomed Hu to speak with the crowd. See our story for details of what Hu said during his speech, and during an earlier address to Boeing employees.

Posted by Todd Bishop at April 19, 2006 3:33 p.m.
Categories: Bill Gates, Financial & Corporate
Comments

Mr Hu pushes all the right buttons at Boeing
From Chris Ayres in Los Angeles



AS CORPORATE America rolls out the red carpet for Hu Jintao, the President of China is putting on the charm.

Mr Hu, visiting the Boeing factory in Seattle yesterday, lowered the shutters to show a side of his personality that Chinese observers had never seen. He accepted a baseball cap with the company logo from an employee and then hugged the surprised worker.



Then Mr Hu said something that his audience enjoyed far more. He told employees of the aircraft maker that China would need to buy 2,000 aircraft during the next 15 years.

On the second day of a four-day visit to the United States, Mr Hu toured three Boeing assembly lines and was briefed on the new Boeing 787 jet under development.

China recently signed a deal with the company to buy 80 737 jets worth about $4 billion (£2.2 billion).

Anticipating pressure from President Bush to take steps to trim his country’s massive trade surplus with the United States, which reached $202 billion last year, Mr Hu predicted a bright future for Boeing in the Chinese market.

In a speech to several hundred Boeing employees at the plant near Seattle, Mr Hu said that his country would need to buy 600 new aircraft during the next five years and 2,000 by 2021 as the Chinese economy continued to race ahead.

“This clearly points to a bright tomorrow for future co-operation between China and Boeing,” he said. For good measure, Mr Hu, who is due to meet Mr Bush in Washington today, noted that the American company had two thirds of the Chinese commercial aviation market.

Mr Hu’s factory visit came at the tail end of a lavish welcome to America for the Chinese President from Bill Gates, co-founder of Microsoft and the world’s richest man, at his $100 million (£56 million) lakeside mansion in Seattle.

A dinner at the mansion, officially hosted not by Mr Gates but by the Washington State Governor, Christine Gregoire, was attended by 100 dignitaries including Howard Schultz, chairman of Starbucks, the world-conquering Seattle coffee chain.

Dinner conversation included a discussion on software piracy. It is thought that Mr Hu reassured Mr Gates about the enforcement of his recent decree that all PCs made in China must have a licensed operating system installed on them before leaving the factory. As a result of the new law, three Chinese computer manufacturers have already ordered more than $400 million of the Windows operating system from Microsoft.

“We’re encouraged by China’s efforts to strengthen intellectual property protection, which will provide the foundation for continued expansion of the IT industry in China,” Mr Gates said.

Mr Hu responded: “China is focused on and has already accomplished much in creating and enforcing laws to protect intellectual property. We take our promises very seriously.”

Mr Hu is also likely to discuss intellectual property with Mr Bush when the two meet at the White House today. Trade groups say that 90 per cent of DVDs, music CDs and software sold in China are pirated.

In Seattle, advocates of various causes protested near the luxurious Fairmont Hotel, where the Chinese President was staying. These included supporters of the Falun Gong spiritual movement, which is banned in China, and others demanding that China leave Tibet and Taiwan.

In Seattle’s Chinatown, shops displayed Chinese and American flags to welcome the President, and many in the throng outside the hotel wanted to show their support.

Wu Yi, the Chinese Vice-President, during a visit to the United States last week, signed more than $16.2 billion of contracts in an effort to improve trade relations.

Robert Zoellick, the US Deputy Secretary of State, has said that Beijing had been “agonisingly slow” in reforming its currency. American officials say that the yuan is undervalued, making Chinese exports artificially cheap.

Mr Bush, speaking ahead of Mr Hu’s lunch at the White House, said: “We can either look at China and say, ‘Let’s compete with China in a fair way’, or say: ‘We can’t compete with China and therefore ’Skind of isolate ourselves from the world.’ I’ve chosen the former route for the United States.”

COMING TO AMERICA



Tuesday: Landed in Seattle. Toured Microsoft campus. Met Christine Gregoire, Washington State Governor, Mark Emmert, University of Washington president, and Clark Randt, US Ambassador to China. Dinner at the Gates mansion

Yesterday: Met executives of Boeing Co. China recently bought 80 Boeing 737s, worth $4 billion (£2.2 billion), from the company

Today: Lunch with President Bush. Conversation expected to cover Iran, currency reform, human rights in China and Taiwanese independence. Mr Bush wants China to put pressure on Iran to end its nuclear programme. China wants support on Taiwan. Mr Bush has pledged to support Taiwan if the Chinese attack

Tomorrow: President Hu will give a speech on China’s growth at Yale University

Saturday: The Chinese President will leave for Saudia Arabia, Morocco, Nigeria and Kenya, to talk about energy

HU’S WHO’S WHO

Li Zhaoxing

Foreign Minister

Mr Li, 64, served as ambassador to the United Nations and to the United States before his appointment as minister in 2003. He likes to quote Shakespeare, writes poetry and is armed with a ready laugh, all attributes that mask a shrewd understanding of American politics and his credentials as a hawkish proponent of China’s national interests.


Ma Kai

Minister of the State Development and Reform Commission

Appointed in 2003 to head the body charged with directing reform in China. The commission under this leadership has guarded the flame of old-style central planning, trying to regulate the economy by edict instead of letting market forces gain sway. Mr Ma, one of eight children, is the “princeling” son of a leading revolutionary.


Bo Xilai

Commerce Minister

Mr Bo, the son of one of China’s most venerated party elders, earned his spurs running the northeastern port city of Dalian and was elevated to the Cabinet in 2003. Initial concerns that he was too inexperienced to be China’s top trade negotiator have been allayed by his skill at deflecting a series of trade rows ― aided by a wicked sense of humour and a clear ease in public.

Security tight at Boeing plant
By Christopher Schwarzen

Seattle Times Snohomish bureau reporter

EVERETT ― An invitation to hear the Chinese president went out to all 20,000 Boeing employees at the Everett plant as well as other locations throughout Puget Sound, with the understanding that security would be much tighter than other Boeing events held inside the production bays. Employees were told to be inside and through security checks by 10 a.m. President Hu Jintao and Boeing commercial airplanes chief executive Alan Mulally didn't appear until 10:55 a.m., much to the grumbles of many employees needing to get back to work.

Between 5,000 and 6,000 employees, dignitaries and invited guests made up the crowd, including Congressmen Rick Larsen and Jim McDermott, Gov. Christine Gregoire and executives from King and Snohomish counties.


More coverage of Hu's visit



China President Hu Jintao arrived in the Seattle area on Tuesday. His visit will include tours of Boeing and Microsoft and an official dinner hosted by the governor.



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Audio slideshow | Protest and support for Hu Jintao in Seattle
Photo gallery | President Hu's visit, Day One
Plasma Dreams, an illustrated look at trade with China (PDF)
TimesWatch | China (PDF)
As U.S.-China trade grows, so does the trade gap

With a movie-theater-size screen hung high above the stage, employees watched images of the future 787 Dreamliner fly through the sky prior to Hu's appearance. They also heard interview segments with employees of Chinese parts' contractors. On stage were 14 U.S. and Chinese flags as part of the stage backdrop.

Thankful for the business

Robert Thomas, who has worked at Boeing since 1988, now works on the 777 assembly line. Before the speeches, he said, "With domestic air carriers failing, if it weren't for Asian companies buying airplanes, we'd be hurting now. If Boeing continues to sell, then we get to keep working. I think most workers here are resigned to the fact that they'll be building parts in other countries, but we don't want to lose final assembly here. We've already lost a lot of jobs to outsourcing."

Robert Christian, 20-year-Boeing employee in commercial procurement, said, "We [Boeing employees] know that regardless of what is going on in the world, China is a big part of our work here. I think it's important that the finishing process stays ere, but it's impossible to ignore that you can get things done less expensively overseas. That's always going to be a challenge for this company."

Leslie Penner, a 27-year Boeing veteran for a 20-month layoff in 1983, gets parts where they need to be for the 777 assembly line.

"I'm here to support Hu because China is our [Boeing's] future. We're always in fear of our jobs being out-sourced, but I know that at age 55, I'll retire in about five years without losing my job again. But the younger generation here is much more iffy. It's a bittersweet arrangement. China buys planes, but they also make parts, which means jobs.

Congressman to meet Hu in the other Washington




Rep. Rick Larsen, who met with Hu during the welcoming ceremony, will have a chance to sit down with him for conversation in Washington, D.C.

"We started a U.S.-Chinese working group to educate Congress on China. Talk there is not always positive about China and some times inaccurate. We want to encourage a change in that," Larsen said.

On the other side of the relationship, he said, "It's important that the Chinese remember there are great companies like Boeing in the United States that can help the Chinese economy grow. We want to talk about investment. I also want to talk about security and the opportunity for military-to-military talks. It's a chance to work together and lower some of the tensions there."

On human rights, Larsen had no intention to raise the issue. "I think the Chinese are getting the hint that when they come to the United States, everything is on the table."

P.S. from Gates dinner

If Chinese President Hu Jintao ever needs a new job, he may want to serve as a pitchman Starbucks.

Speaking to business executives, politicians and other dignitaries during a dinner Tuesday at the home of Microsoft

Chairman Bill Gates, Hu expressed his desire to be a regular at the ubiquitous coffee-store chain.

"Starbucks coffee shops have mushroomed in China's cities," said the Chinese leader through a translator.

"If I were not serving in this office, I would certainly prefer to go into one of the coffee shops run by Starbucks," said the usually reserved Hu, drawing laughter from the crowd, which included Starbucks Chairman Howard Schultz.

Starbucks, based in Seattle, opened its first store in China in 1999 and now has close to 400 shops there. It expects the country will eventually be its largest overseas market.

― Reuters pool report

China leader seeks closer ties with U.S.

 
APR. 19 5:39 P.M. ET Chinese President Hu Jintao called Wednesday for fewer trade barriers and closer ties between his country and the United States, while defending China's heavily criticized policies on trade, currency and energy.

The meaty speech followed a warm welcome at Boeing Co., where Hu sought to soothe tensions over the U.S.-China trade deficit, telling workers his country would need thousands of new airplanes in the coming years.

Speaking to an audience of Washington state business and political leaders including Microsoft Corp. Chairman Bill Gates, Hu said his company does not seek a big trade surplus with the U.S. He also reaffirmed his government's commitment to crack down on software piracy, which should increase Microsoft's sales in China.



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"Strong business ties meet the fundamental interests of our two countries and peoples and will continue to play an important role in stabilizing our relations," Hu said through a translator. He flew to Washington D.C. shortly after the speech.
China's rapid growth and development will increase demand for American products and expertise in areas such as technology, Hu said, and "I hope the American businesses will seize the opportunities."

The comments came just ahead of a summit with President Bush, where the two sides plan to tackle thorny issues including trade.

Visiting Boeing's widebody jet assembly plant earlier, he called his country's long-running relationship with Boeing an example of the potential of China-U.S. trade.

"Boeing's cooperation with China is a living example of the mutually beneficial cooperation and win-win outcome that China and the United States have achieved from trade with each other," Hu said.

He estimated that demand for new aircraft in China will reach 2,000 planes in the next 15 years.

Hu's speech at the company's massive Everett plant came just days after Chinese officials confirmed a commitment to order 80 Boeing 737 jets, in a deal valued at $5.2 billion at list prices. The order has yet to be finalized, and airlines typically negotiate discounts.

The Boeing deal is one of several purchases the Chinese have announced recently as officials try to ease tensions over the massive trade gap between the U.S. and China.

Hu's meeting Thursday with Bush will cover a broad agenda, from China's much-criticized currency and other trade policies, to its aggressive search for oil and its positions on the developing nuclear programs in Iran and North Korea.

At his lunchtime speech, Hu touched on several of those issues, defending Chinese currency and energy policy but acknowledging that there have been bumps in the road.

"Given the rapid growth, sheer size and wide scope of our business ties, it is hardly avoidable that some problems have occurred," Hu said. "However, mutually beneficial cooperation and common development remain the defining feature of our business relations."

Hu said China takes its trade imbalance with the U.S. seriously, and noted that his country has trade deficits with Japan, Korea and some southeast Asian countries.

Hu promised that China will take a firm stance protecting intellectual property. He also said his country has already taken some steps to loosen currency regulation and promote financial reforms, in apparent response to U.S. criticism.

The Chinese president said the two countries should address trade issues through formal dialogue.

"Trade issues should not be politicized," he said.

But Hu said strengthening China-U.S. ties will require both sides to continue promoting global free trade and economic development.

He said opportunities included nuclear energy, natural gas, energy conservation and new forms of environmentally friendly energy.

Despite the political tensions expected in Washington, Hu has received a warm and curious welcome during his visits to Boeing and, on Tuesday, Microsoft. The thousands of Boeing workers, some of whom waited hours for a 10-minute speech Wednesday, appeared eager for a glimpse of Hu.

"China is one of the largest markets for Boeing," said Craig Thompson, an engineer at the Everett plant. "The guy's coming here. I'm going to listen to what he has to say."

Hu began his day Wednesday visiting at his hotel with China scholars and academics, including former Secretary of State Henry Kissinger, former National Security Adviser Brent Scowcroft and former Defense Secretary William J. Perry.

On Tuesday, Hu toured Microsoft's suburban Redmond campus and dined at company chairman Bill Gates' home. Hu said he admired what Gates had achieved.

------

Associated Press Writers Allison Linn, Peggy Andersen and Melanthia Mitchell contributed to this report.

Hu begins US charm offensive

Seattle (dpa) - Chinese President Hu Jintao toured Boeing's massive aeroplane factory outside Seattle Wednesday as he continued a public relations offensive ahead of a crucial meeting with President George W Bush scheduled for Thursday.

The Chinese president held out the prospect of billions of dollars worth of contracts for the US aircraft maker, on top of a deal for 80 Boeing 737 jets, worth 5.2 billion dollars, announced last week in the run-up to his visit.

Hu predicted that China would need an additional 600 planes in the next five years, while demand for new aircraft could reach 2,000 planes over 15 years.

"Boeing's cooperation with China is a vivid example of the mutually beneficial cooperation and win-win outcome that China and the United States have achieved from trading with each other," he said following the factory visit.

"I also sincerely hope that the economic and trade relations between our two countries in general will prosper further and fly higher, just like a Boeing plane."

Boeing Co is the world's second largest aircraft maker and one of the US' largest exporters in terms of sales.

In Washington, a senior US lawmaker said Wednesday on the eve of Chinese President Hu Jintao's visit to the capital that China's human rights record is "abysmal."

China's practices - from its regulation of the Internet to executions and curbs on Western-style religious freedom - faced a harsh criticism at a House of Representatives subcommittee hearing.

"While China's economy has improved somewhat, the human rights situation remains abysmal," said Christopher Smith, a member of President George W Bush's Republican party who heads the panel.

"So-called economic reform has utterly failed to result in the protection of freedom of speech, expression or assembly," Smith told the hearing.

The daylong hearing came a day before Hu meets Bush at the White House for a high-profile meeting expected to highlight areas of cooperation between the two countries.

Hu arrived in the US on Tuesday in a visit designed to allay US fears over its complex relationship with China and over the country's rapidly developing economy.

His first day in Seattle saw him meet with Microsoft chairman Bill Gates and other local political and business leaders as Hu stressed the close Chinese-American trade ties.

"Long live the China-American friendship," Hu wrote on a computer in a tour of an educational facility. Hu also said that US-Chinese relations were enjoying a "sound momentum of growth", and that the two nations were shouldering joint responsibility for promoting peace and development.

At his hotel in Seattle Wednesday morning, Hu met with former US secretary of state Henry Kissinger, who first normalized ties between the countries in 1972, as well as former National Security Adviser Brent Scowcroft and former Defence Secretary William J Perry. He was also due to give a policy speech to a strategic think-tank later in the day.

Hu pledged to keep China on a path of reform that would increase trade with the US.

"Today, many cargo ships are very busy crossing the Pacific Ocean, laden with the rich fruit of our strong trade ties and friendship between our two peoples," Hu said at an official dinner at Gates' 100 million dollar lakeside residence Tuesday evening, hosted by Washington state Governor Christine Gregoire.

"I am sure that with the further deepening of China's reform and opening up, we are going to see an even broader prospect for the economic cooperation and trade between China and Washington state and China and the United States as a whole."

On a lighter note, Hu asked Gates for help in using Microsoft's Windows operating system and confessed that, were it not for the restrictions of his office, he would be a regular at one of the many coffee shops operated in his country by the Seattle-based chain Starbucks.

Hu's visit takes place against the backdrop of simmering tension over China's economic power and differences over the Iranian nuclear crisis.

A sweeping range of topics was on the agenda for the communist leader's trip, underlining a complex relationship that includes the huge US trade gap with China and the Pentagon's view of China as a future military rival.

Ahead of Hu's visit, Chinese officials sealed 16 billion dollars worth of deals in more than a dozen US states, a business whirlwind designed to soothe US concerns that trade with China is a one-way street.

Lenovo Group Ltd, China's largest PC maker, said Monday it was buying 1.2 billion dollars of Microsoft's Windows software over the next year in an effort to placate US demands for better copyright enforcement in China.

Conflicts could surface over China's cautious approach on curbing Iran's nuclear programme and differing approaches to North Korea.

"I intend, of course, to bring the subject up of Iranian ambitions to have a nuclear weapon, with Hu Jintao this Thursday," Bush said Tuesday in Washington, pledging to pursue diplomacy on the issue.

China's currency, which the US claims is being kept artificially low to boost Chinese exports, is another point of friction.

The US blames it for part of its 200-billion-dollar trade gap with China last year. US Commerce Secretary Carlos Gutierrez on Tuesday urged Hu to use his visit to blunt calls in Congress and elsewhere for protection against Chinese imports.

Bush last week called the relationship with China "very positive and complex," but said he would push for "fairness in trade."

On Friday, Hu is due to give a speech at Yale University in New Haven, Connecticut, outlining plans for China's peaceful development.

After concluding his US trip Friday, Hu will continue on to Saudi Arabia, Morocco, Nigeria and Kenya.

.

Gregoire asks Hu for trade ties

By DAVID AMMONS
AP POLITICAL WRITER

OLYMPIA, Wash. -- Gov. Chris Gregoire has spent this week lobbying President Hu Jintao of China to open a trade office in Washington state, inaugurate direct Seattle-to-Beijing flights, and forge stronger trade, tourism and business links.

The governor, who met privately with the president on Tuesday and again briefly Wednesday, said Hu's response was favorable on all points.

"He was very warm and gracious," said Gregoire's spokeswoman, Holly Armstrong. "He was receptive to all of these suggestions."

Washington state, which was at the forefront of opening ports to Chinese goods after normalization of trade between the two countries, is poised to score even more business with the world's most populous nation, Gregoire said.

The state has two trade offices in China and Gregoire visited the country last year. Gregoire told reporters that Hu seemed receptive to her suggestion that China set up a trade office here.

"Not only did he know that we had exported over $5 billion dollars in goods and services last year, but that he would expect much more in the future," she said after the Tuesday meeting with Hu.



Gregoire also said she asked Hu if China would host a Pacific summit on global health like one being held in Seattle in June, and would create an educational institute in China for students and teachers from Washington, and one here for those from China.

Armstrong said Wednesday that Gregoire has been delighted to show off Washington, including the products of world-class companies headquartered here.

"Washington is the only state with a positive balance of trade with China, something we are very proud of," Armstrong said.

Gregoire gave Hu a gift crate loaded with Washington products - and she and Starbucks Chairman Howard Schultz even gave him a steaming cup of freshly brewed Starbucks java as he left his hotel for his day's activities Wednesday morning.

---

This report includes material from a pool report compiled by The Associated Press.