Obama in China faces tensions on trade and Tibet

SHANGHAI Sun Nov 15, 2009 11:34am EST

1 of 6. U.S. President Barack Obama steps off Air Force One as he arrives at Pudong International Airport in Shanghai November 15, 2009. The Chinese characters read: 'China Eastern Airlines'.

Credit: Reuters/Jim Young

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SHANGHAI (Reuters) - U.S. President Barack Obama faces tensions with China over trade and Tibet on his first visit to the emerging superpower for a summit that will grapple with economic imbalances and the future of the yuan.

Obama arrived in Shanghai, China's commercial hub, late on Sunday to torrential rain and is due to meet city officials and hold a town hall-style meeting with young people before heading to Beijing later on Monday.

Chinese state-run Internet sites have asked the public for suggested questions to quiz Obama with at the youth meeting, and many urged him to explain any plans to meet the Dalai Lama, the exiled Tibetan leader whom Beijing scorns as a "separatist."

These events will be a warm-up for Obama's summit with President Hu Jintao in the national capital on Tuesday that will cover trouble-spots such as North Korea and Iran, and efforts to forge a new climate pact.

Obama has said he will also raise the sensitive subjects of human rights, and sometimes tense trade ties and China's yuan currency, seen by U.S. industry as significantly undervalued and stoking unsustainable global economic imbalances.

"The president will be talking about balanced, strong sustainable growth and the policies that go into making that happen," a U.S. official told Reuters, though added they did not expect any tension over recent trade spats.

"We've had very good meetings with them around a variety of issues. We have a deep and broad economic relationship with them."

At a gathering of Asia-Pacific leaders in Singapore over the weekend, Hu pointedly ignored international calls for his government to help ease those imbalances by raising the value of the yuan, making Chinese exports relatively more expensive.

He and other senior Chinese officials have instead accused other countries -- implicitly including the United States -- of embracing damaging trade protectionism aimed at Chinese goods.

Obama's meetings with China's leaders are unlikely to yield any big policy shifts on the diplomatic and economic problems facing the two big powers, said Drew Thompson, an expert on China at the Nixon Center in Washington, D.C.

"This isn't a trip about deliverables," Thompson told reporters in Beijing, where he was visiting. "It's a trip about staying the course, keeping the two ships on the same course and not letting them bump into one another."

SHARP JABS OR SOFT STROKES

Having already made their gripes clear before the summit, Obama and Hu may avoid sharp public jabs as they focus on building goodwill.

Obama has cast his visit as an effort to win trust from a government and a public often wary of U.S. intentions toward the rising Asian superpower and world's third biggest economy.

The United States welcomed Beijing's growing global role and "does not seek to contain" it, Obama said in a tone-setting speech on Asian policy in Tokyo on Saturday.

But nearly 80 percent of Chinese respondents who answered an online survey said the United States did not want to see their country rise, the Chinese magazine, Globe, reported last week.

Ben Rhodes, a White House communications official, told reporters with Obama that the Shanghai meeting would be streamed over the White House website (www.WhiteHouse.gov).

It appeared China would not fulfill U.S. hopes for the session to be broadcast nationwide on Chinese television. Officials wanted to show it only on a local Shanghai service, said Richard Buangan, a spokesman for the U.S. Embassy in Beijing, who was in Shanghai for the President's arrival.

(Reporting by Patricia Zengerle and Caren Bohan; Writing by Chris Buckley; Editing by Benjamin Kang Lim and Charles Dick)

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