Gutierrez To Focus On Trade Surplus, Open Markets During China Visit

Gutierrez in China to discuss barriers that have contributed to a soaring and politically touchy Chinese trade surplus.

BEIJING (AP) - U.S. Commerce Secretary Carlos Gutierrez began a trip to Beijing on Monday to help American entrepreneurs clinch deals and to discuss barriers that have contributed to a soaring and politically touchy Chinese trade surplus.

Highlighting his efforts to increase U.S. exports, Gutierrez watched Motorola Inc. sign a contract to supply $1.6 billion worth of cell phones to a Chinese distributor. He also presided at a ceremony by studio Twentieth Century Fox's home entertainment division to distribute moderately priced authorized DVDs in the piracy-plagued China market.

Around the signings, Gutierrez held talks with senior Chinese trade officials that he said broadly covered access to the China market, persisting product piracy and unclear government regulations.

Americans are worried about record trade imbalances with China which are projected to rise 12 percent to $228 billion this year. Pressure on the Bush administration over the deficit is expected to increase following the opposition Democratic Party's recapture of Congress in elections last week.

Trying to seize the initiative, Chinese Vice Premier Wu Yi told Gutierrez: ''We welcome the exports of your country. The Chinese market is completely opened to the outside world.''

Wu reiterated a long-standing Chinese complaint that American export controls prohibited the transfer of high-technology products, thereby keeping some U.S. goods out of China.

Gutierrez, who brought along a delegation of 25 American businesses, from heavy equipment makers to architecture firms, stressed that Washington sought more open markets, not protectionism.

''Ultimately what counts is results. Both sides are increasing the amount of business they do with each other,'' he told reporters. He said that American exports this year totaled about $50 billion in products and services and were up 34 percent this year to date.

Concerns, however, continued over Chinese regulations limiting the retail business of U.S. and other foreign banks and the widespread copying of U.S. goods and other infringements of intellectual property, Gutierrez said.

''The United States and China will continue to fight piracy. This is a priority for both governments,'' Gutierrez said at a signing ceremony for the deal by News Corp.'s Twentieth Century Fox. ''We will both work as hard as we have to stamp out piracy.''

Deals like the Fox arrangement are part of an effort by American entertainment companies to offer Chinese consumers inexpensive but legal CDs and DVDs as an alternative to cheap pirated ones widely available in China. Such pirated products, Gutierrez said, are costing American companies ''hundreds of millions of dollars'' in sales.

Under the deal, Twentieth Century Fox Home Entertainment LTD will begin distributing DVDs through Chinese video distributor Zoke Culture Group, the companies said.

Also signed Monday was the Motorola contract to supply 12 million mobile handsets to Shenzhen Telling Telecom Development Co., executives from both companies said.

A subsidiary of U.S.-based Han's Technologies Inc. also signed an agreement to build and operate seven water supply plants and 13 wastewater treatments plants to the Chinese county of Xiangshan. Terms were not disclosed.