China, US's Harsco sign construction joint venture

[October 28, 2009]  HANGZHOU, China (AP) -- Top U.S. trade officials visiting China for high level talks on nuts-and-bolts economic issues oversaw the signing Wednesday of a joint venture between major Chinese and U.S. construction companies -- a deal meant to create jobs on both sides.

"The profound reality is that trade means jobs and this joint venture means good jobs in both America and here," Ron Kirk, President Barack Obama's senior trade emissary, said of the deal between Harsco Corp. and state-run Zhejiang Construction Materials Corp.

Kirk, the U.S. Trade Representative, and other top U.S. officials were in Hangzhou, an eastern China city near Shanghai, for the annual meeting of the U.S.-China Joint Commission on Commerce and Trade.

The talks often tackle contentious issues such as copyright piracy and tariff disputes, but this time the emphasis was on cooperation rather than conflict since the meeting comes just weeks before Obama is due to visit China.

Earlier in the day, Commerce Secretary Gary Locke announced plans for a U.S.-China Energy Cooperation Program -- a public-private partnership that will use U.S. expertise to help develop clean energy in China.

China and the United States are each others' second biggest trading partners, with nearly $400 billion in two-way trade in 2008. But a string of trade disputes had soured otherwise warm relations over recent months, with the two sides clashing over products such as steel pipes, auto parts, movies, poultry and other goods.

"As we growth and expand, inevitably we're going to have challenges and problems we have to deal with. We need an open relationship in which we can speak openly of our disagreements," Jon Huntsman, the U.S. Ambassador to China, said Wednesday in a meeting with the Chinese side.

He said the meeting in Hangzhou would help set the direction for trade and investment for years to come.

Locke told reporters the one-day talks Thursday would not touch on U.S. concerns over China's currency controls -- restrictions that in effect keep the value of the yuan, or renminbi, closely tied to the U.S. dollar.

Critics say the currency regime keeps the yuan artificially weak, giving Chinese exporters an unfair advantage and contributing to the trade imbalance between the two countries. However, the Obama administration recently chose not to designate Beijing as a "currency manipulator."

Financial details of the joint venture between Harrisburg, Pennsylvania-based Harsco and the Zhejiang company, one of China's biggest contractors, were not announced. But Locke said the tie-up would mean $100 million in additional revenue for Harsco over the next five years.

Construction of new railways and other infrastructure is a major part of China's 4 trillion yuan ($586 billion) economic stimulus package. Harsco has major contracts in Chinese railway and subway construction, with more than $100 million of its $4 billion in annual revenue earned in the country.

China will build 40 billion square meters (430 billion sq. feet) of residential, office and industrial space in coming years, or the equivalent of tens of thousands of new skyscrapers, said Locke, whose family has ties in south China's Guangdong province.

"This project will help retain and create jobs in the U.S. by providing more export opportunities -- and it will bring crucial new technology and know-how to China," he said.

[Associated Press; By ELAINE KURTENBACH]

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