31) Strategic Dialogue China-USA: testimony Fred Bergsten

Testimony
The United States–China Economic Relationship and the Strategic and Economic Dialogue
C. Fred Bergsten
Institute for International Economics, September 10, 2009

C. Fred Bergsten testifies before the US House of Representatives that there is now substantial evidence that the initial Strategic and Economic Dialogue (S&ED), building on other United States–China contacts and its own predecessor forums, has made an important contribution toward progress on two international economic issues: the current economic crisis and global warming. The S&ED is also helping to create an informal G-2 joint leadership of the world economy that can supplement, not supplant, existing steering committees, including the G-7/8 and the G-20, and the major multilateral institutions (notably the IMF and WTO).

There is less indication that the two countries have been able to use the S&ED to date to address their concerns regarding other systemic issues such as the stability of the dollar, possible restrictions on China's future direct investments in the United States, and Chinese currency intervention. Other important opportunities for G-2 leadership include stronger IMF surveillance of national economic policies, reform of the governance of the international financial institutions, and preserving an open global trading system.

Hence the new S&ED has both a positive record of achievement and a rich agenda for future action at both the broad conceptual and practical policy levels. The two governments should continue, broaden and deepen the approach, and the Congress should continue to monitor the process to make sure that it realizes its full potential.

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