Clinton: US, China must act together on NKorea

[May 24, 2010]  BEIJING (AP) -- U.S. Secretary of State Hillary Rodham Clinton urged China on Monday to work with the United States to coordinate a response to the sinking of a South Korean warship, which has been blamed on North Korea.

Opening high-level U.S.-China strategic and economic talks in Beijing, Clinton said North Korea must be held to account for the incident, which international investigators have determined was caused by a torpedo fired from a North Korean submarine.

China is North Korea's main ally and has so far remained neutral on the investigation. U.S. officials say they have to do more to convince China that North Korea was responsible and support a U.N. Security Council response to what Washington and its allies believe is a serious breach of the truce that ended the Korean War.

The ship sinking has overshadowed the two days of talks that were scheduled to focus on global financial issues, climate change and countering terrorism.

Clinton, who is due to visit Seoul on Wednesday, called the situation with North Korea a "matter of urgent concern."

"Today, we face another serious challenge provoked by the sinking of the South Korean ship. So we must work together ... to address this challenge and advance our shared objectives of peace and stability on the Korean peninsula," she said.

In Seoul, South Korean President Lee Myung-bak said Monday his country will take the case to the U.N. Security Council, suspend inter-Korean exchanges and ban North Korean ships from passing through its waters.

"North Korea will pay a price corresponding to its provocative acts," he said. "I will continue to take stern measures to hold the North accountable."

North Korea's main newspaper, the Rodong Sinmun, called the investigation results an "intolerable, grave provocation" tantamount to a declaration of war.

Clinton also called on China to continue work with the United States and other members of the Security Council to draft new sanctions on Iran to press it to come clean on its suspect nuclear program. U.S. officials say more work is needed to get China to agree to specific Iranian companies and individuals that will be subject to penalties.

She said the draft resolution that the U.S. and China have agreed on "sends a clear message to the Iranian leadership: live up to your obligations or face growing isolation and consequences. As we continue to cooperate in New York, the burden is Iran to demonstrate through its actions that it will uphold its responsibilities."

Clinton was joined onstage at China's Great Hall of the People by Treasury Secretary Timothy Geithner and Chinese Vice Premier Wang Qishan and State Councilor Dai Bingguo, all of whom spoke. Neither Wang nor Dai specifically mentioned North Korea or Iran, but Dai made clear in that China would not support any attempt to provoke conflict.

"No attempt to stir up confrontation and stage war, be it a hot war, a cold war or even a warm war, will be popular in today's world," he said. "Nor will such an attempt lead to anywhere."

Similarly, Chinese President Hu Jintao, who also addressed the opening session, did not mention North Korea by name but spoke of the responsibilities shared by the United States and China for "managing regional hotspots" and "safeguarding world peace and security."

On the broader relationship, each of the speakers talked about the need to conduct business on "win-win basis," where the two sides look at each other not as rivals but as partners.

Clinton and Geithner are both pushing Beijing to level the playing field for U.S. companies operating in China and promote greater openness in regulations, nondiscrimination, fair access to markets and strong enforcement of intellectual property rights. Those are important elements in fulfilling President Barack Obama's pledge to double U.S. exports within five years and create 2 million jobs.

Another issue is the trade advantage Beijing has because of an undervalued Chinese currency. China appears to be pulling back from expected moves to loosen its currency's peg to the U.S. dollar, saying the euro's slide to four-year lows against the dollar is putting too heavy a burden on its own exporters.

Hu promised more reforms to China's controversial exchange rate controls but gave no timetable. "China will continue to steadily advance the reform of the formation of the (yuan) exchange rate mechanism under the principle of independent decision-making controllability and gradual progress," he said.

In a letter to participants, Obama said the dialogue was important as it would allow the countries to "understand one another better," particularly on issues over which they disagree, such as human rights and the situations in Tibet and Taiwan.

But in his remarks, Hu foreshadowed resistance the Americans will face over any discussion of Tibet or Taiwan. He referred twice in a 10-minute speech to "core interests" -- a phrase coined by Beijing to emphasize the importance of its territorial claims.

"We should respect each other's core interests," Hu said. "To the Chinese people, nothing is more important than safeguarding national sovereignty and territorial integrity. I trust it is not difficult for the American people, who went through the American Civil War in their history, to understand how important and valuable unity is to a nation."

[Associated Press; By MATTHEW LEE]

Associated Press writer Joe McDonald contributed to this report.

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