Six-party nuke talks start in Beijing today
From Max Lee
The Daily Mail’s Special
Correspondent in Beijing

BEIJING—Fifth round of six-nation talks on ending North Korea's nuclear program will take place in Beijing Wednesday.
According to Chinese Vice Foreign Minister Wu Dawei, the talks will last three days and are unlikely to reach a breakthrough, although negotiations will resume by the end of the year.
Wu downplayed expectations of progress in the talks, noting there was still a gap between the United States and North Korea.
He told reporters that they want to set up another opportunity for further discussions. It will be resumed within the year. Wu suggested setting up a panel of experts to carry out the statement reached in September under which North Korea agreed in principle to scrap its nuclear programs in exchange for energy assistance and other benefits.
"We will ask the participating nations to discuss ways to execute the joint statement," he said.
China, Japan, South Korea, Russia and the United States have been negotiating on and off with North Korea since 2003 amid fears that North Korea is preparing nuclear weapons.
The United States wants North Korea to dismantle its nuclear program immediately, while Pyongyang is holding out for benefits upfront from Washington before surrendering its bargaining chip. The United States says North Korea must first disarm.
Japan’s chief negotiatior Kenichiro Sasae told reporters after arriving in Beijing on Tuesday that North Korea would be urged to adopt a phased approach to dismantling its nuclear weapons program. “We will study how to implement what we agreed at the last six-party round,” Sasae said.
“We believe it is necessary to achieve progress on the central question, that is how to proceed in concrete terms with nuclear disarmament, which was promised by North Korea. “Japan for its part believes it is important to present a specific prospect leading to next steps”.
Sasae did not give details. The Japanese Asahi Shimbun newspaper said Japan, the United States and South Korea would propose a “road map” to the North under which it would give up its nuclear weapons in return for promised benefits. The road map would include a timeline for ways for Pyongyang to verify it is giving up its nuclear program, the Asahi Shimbun said, citing South Korean diplomatic sources.
The newspaper said the road map would include a series of stages starting with North Korea confirming its nuclear programs are dismantled, freezing nuclear facilities and renouncing its nuclear program.
In exchange for further benefits, Pyongyang would eventually need to return to the Nuclear Non-Proliferation Treaty (NPT) and accept inspections by the UN International Atomic Energy Agency.
The United States and Japan accuse North Korea of violating a 1994 agreement under which a US-led consortium would have built two light water reactors in the impoverished state in return for nuclear disarmament.
The United States accused the North in 2002 of developing a secret uranium-enrichment program. The North responded by throwing out weapons inspectors and leaving the NPT.
All the delegations to the talks except the US team led by Christopher Hill, had arrived in Beijing by mid-afternoon on Tuesday. Hill was due to land in the early evening.
The other delegations were holding various bilateral meetings on Tuesday.
North Korea’s lead negotiator divulged little on arrival.

US, China textile row resolved
Bureau Report

BEIJING—The United States and China have signed a deal to resolve a trade dispute over imports of Chinese clothing and textile products into the United States, the two sides said Tuesday. US Trade Representative Rob Portman and Chinese Commerce Minister Bo Xilai announced the deal at a joint news conference in London and hailed it as a success for both sides.
“I believe the textile agreement shows our ability to resolve tough trade disputes in a manner that benefits both countries,” Portman said.
The accord is aimed at smoothing over a rough spot in the US-China trade relationship before President George Bush visits Beijing in the middle of this month.
The deal follows one China reached with the 25-nation European Union earlier this year and comes just over a week before US President George W. Bush is due to visit China.
Portman said the agreement was fair to both countries, and called it an example of what “hard work” and “good faith” could accomplish.
Bo described the outcome as a “win-win result”, though he later said the agreement was “a far cry” from Beijing’s original expectations.
The accord was reached after seven rounds of negotiations, at some of which Bo said the two sides had been “almost at the edge of a cliff”.
The deal covers more than 30 individual products and contains quotas that a US statement said would begin at low levels.
An unnamed US official said the accord would allow hundreds of thousands of Chinese garments piled up in US ports to be sold.
The deal is intended to smooth over a rough spot in the US-China trade relationship before President George Bush visits Beijing in the middle of this month.
China’s exports of clothing and textile products to the United States jumped more than 50 percent in the first eight months of 2005 to nearly $17.7 billion following the end of a global quota system on January 1.
That prompted U.S. textile producers to seek protection under a “safeguard” provision of China’s 2001 entry into the World Trade Organisation. The measure allows WTO members to restrict the growth in imports from China to 7.5 percent annually when there is a market-disrupting surge.
The Bush administration has imposed safeguard curbs on billions of dollars’ worth of Chinese clothing imports this year. But because the curbs have to be renewed annually, textile groups have pushed for a comprehensive agreement that would limit imports until 2008 when the safeguard provision expires.
US textile and clothing companies and their labor unions were pushing for a comprehensive deal to stem a flood of Chinese imports that began last January when global quotas, in place for more than three decades, were lifted.
Cass Johnson, president of the National Council of Textile Organizations, said on Sunday the new textile agreement was expected to restrict 34 categories of clothing and textile imports from China through 2008.

Pak, China to hold joint Naval drill by month end
From Javed Akhtar ( APP)

BEIJING—A fleet of the People’s Liberation Army Navy left Chinese Zhanjiang city in Guangdong province Tuesday for a visit to Pakistan to hold Joint naval exercise.
Sources told APP that the naval fleet, composed of a missile destroyer and an arms depot ship is scheduled to hold joint military drills, the first ever by the Chinese navy in alien sea areas with Pakistan Navy.
The drills will focus on items in non-traditional areas, such as joint search-and-rescue exercises. Passing four straits, the fleet is expected to enter the Arabian Sea via northern zone, the part of the Indian Ocean.
It will be the second joint naval exercise between the two navies to further enhance their professional capability.
The two sides had conducted their first-ever exercise in November, 2003 near the Shanghai coast. “Now the Chinese side is going to visit Pakistan’s sea water to have the similar drill, the sources added.
As a part of long-standing bilateral cooperation in the Defense field, the two countries have been maintaining frequent exchanges to benefit from each other experience, strengthening their defence potential.
It may be mentioned here that the two navies have recently reached high-level collaboration. It was decided China will provide four F-22P advanced quality frigates to Pakistan by 2013. Of these, three will be manufactured in China, while one frigate will be built in Pakistan. First frigate will be available to Pakistan Navy within a period of three and half years.
Besides this, the Chinese side will also provide six medium-size standardized helicopters (Z-9C) to Pakistan Navy.

China to push forward yuan reform

BEIJING—China’s central bank reiterated it will gradually push forward reform of its float currency regime while keeping its exchange rate at a “reasonable and balanced level”.
“We will gradually push forward reform of the exchange rate mechanism, establish a market-oriented, managed floating exchange rate system and maintain the basic stability of the yuan at a reasonable and balanced level,” the central bank said on its website.
The People’s Bank of China stressed that a “stable currency value would help to maintain financial stability”.
“China’s active exchange rate reform, sound international balance of payments, ample foreign exchange reserves and gradual opening of the capital account have provided a good external environment for China’s financial stability,” the bank said Monday.
China’s major trade partners, especially the United States, have been pressuring Beijing to allow more flexibility into the regime following the scrapping of a peg to the US dollar and a 2.1 percent revaluation on July 21.
The yuan closed Monday at 8.0877 yuan to the dollar, compared with the initial revaluation rate of 8.11.
The bank also said it would continue to carefully watch changes in the global economy, “including the negative impact on the global financial stability from US interest rate hikes, surging oil prices and trade frictions”.
Further liberalisation of China’s interest rate regime and speeding up the reform of financial institutions were also on the table, it said.
To maintain stability the economy needs to be rebalanced, away from investment and exports, it said, adding that lessening local governments’ debt burdens and reliance on the banking system for credit were also crucial.

—The Daily Mail-China Daily news exchange item