U.S. official sees progress on disputed China waters

By Ben Feller

Associated Press

Published: Saturday, Nov. 19 2011 11:57 p.m. MST

From left to right, U.S. President Barack Obama, Myanmar's President Thein Sein, rear, Chinese Premier Wen Jiabao, Vietnamese President Nguyen Tan Dung, Australian Prime Minister Julia Gillard and Malaysia's Prime Minister Najib Razak leave the stage after a group photo at the Retreat Session of East Asia Summit in Nusa Dua, Bali, Indonesia, Saturday, Nov. 19, 2011. (AP Photo/Romeo Gacad, Pool)

Associated Press

ABOARD AIR FORCE ONE — China signaled a gradual evolution toward resolving quarrels with its Asian neighbors over disputed waters of the South China Sea, a senior U.S. administration official said Saturday, describing the development as an encouraging step forward in easing tensions over the busiest trade route in the world.

Chinese Premier Wen Jiabao offered a measured response after 16 of the 18 leaders attending a major Asian summit raised the issue of maritime security, primarily on the South China Sea. The topic has been a thorny issue, with China laying claim to all of the sea, while several Southeast Asian nations claim parts of it.

The U.S. official said Wen seemed reluctant to discuss the dispute during a retreat by the Asian leaders, but responded after President Barack Obama raised it.

The official spoke to reporters aboard Air Force One on the condition of anonymity to discuss a sensitive diplomatic subject. Obama and Wen talked Saturday in a surprise meeting on the sidelines of a major Asian summit, focusing on the economic matters that have prompted disputes between the two major world powers.

The session was not a formally planned moment of diplomacy but rather a late add-on to let the two men continue their conversation from a group dinner the night before.

The South China Sea disputes were discussed only briefly in that meeting, officials said. Instead, Obama and Wen focused on topics such as China currency.

CCTV, China's state broadcaster, said Wen told Obama that China has made strides in reforming its currency exchange and will continue to do so.

Wen also said the world's grim economy made it practical and necessary for China and the U.S. to strengthen their economic and trade relationship, CCTV reported.

"We have a very complicated and quite substantial relationship with China across the board," White House National Security Adviser Tom Donilon told reporters after the one-on-one session.

"We do have economic issues, they are around the proper contribution that the Chinese make to global growth and that goes to currency and other policies," he added.

Donilon said Obama stressed the importance of China adjusting the value of its currency, which the United States contends is deeply undervalued. He said Obama and Wen also briefly discussed territorial disputes in the South China Sea toward the end of their meeting.

But Donilon also downplayed tensions between the two powers, saying the two countries also have found vast areas of agreement.

The Wen-Obama meeting and the subsequent discussion by Asian leaders about the South China Sea came on the last leg of Obama's nine-day Asia-Pacific trip, in which he has focused on bulking up America's presence in the region, including setting up a Marine task force in Australia, in moves largely seen as hedges against China's rise.

A commentary run by the official Xinhua News Agency on Saturday suggested China was uneasy but not alarmed over the renewed U.S. focus on Asia.

"Actually, China as well as other Asian nations never considered the United States had left the Asia Pacific and had never tried to squeeze it out of the region," said the piece, which carried the headline: "U.S. return to Asia raises more questions than can answer."

The commentary noted that the U.S. was trying to court some Asian countries, a clear nod to recent U.S. overtures toward Myanmar, and was interfering in long-standing regional disputes, an apparent reference to U.S. military support for the Philippines as it confronts China in increasingly tense disputes in the South China Sea.

"If the United States sticks to its Cold War mentality and continues to engage with Asian nations in a self-assertive way, it is doomed to incur repulsion in the region," it said.

China has been angered by the U.S. stand that it has a stake in security and unhampered international commerce in the disputed territorial waters of the South China Sea. Wen had told a meeting of Southeast Asian nations on Friday that "external forces should not use any excuse to interfere" in territorial disputes in the sea.

China claims all of the sea, while several Southeast Asian nations claim parts.

Donilon said the United States, as a maritime power, wants territorial disputes resolved peacefully.

"We do believe they should be resolved in accordance with international norms and international law," he said.

Wen's portfolio, though, is chiefly economic, and that is where his conversation with Obama focused, Donilon said. The United States and China have been tussling over China's currency, and over intellectual property. Obama has been challenging China to operate with a greater sense of international rules.

Donilon rejected suggestions that the nine-day mission in the Asia-Pacific was designed to thwart a rising China. The U.S. policy, Donilon said, was about rebalancing U.S. interests and focusing once more on the Asia-pacific region.

"This has nothing to do with isolating or containing anybody," he said.

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Associated Press writer Alexa Olesen in Beijing contributed to this report.

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