UPDATE 1-China, U.S. aim to ease tensions;Hu visit on agenda

* Conciliatory Chinese comments to visiting U.S. officials

* Tone indicates China wants to limit friction

* Two days of talks to feature currency, trade
(Recasts and updates comments in pars 1-8)

By Chris Buckley

BEIJING, Sept 7 (BestGrowthStock) – China wants to reduce tensions
with the United States through quiet talk, not shouting
matches, a top diplomat told White House advisers on Tuesday,
aiming to pave the way for a visit by President Hu Jintao early
next year.

Chinese officials made the conciliatory public comments in
meetings with the U.S. National Economic Council Director,
Larry Summers, and Deputy National Security Adviser Thomas
Donilon. Both were in Beijing for talks.

Washington and Beijing are drawn together by economic and
diplomatic interests, but this year has brought bursts of
contention over Internet policies, U.S. arms sales to Taiwan,
Tibet, and Chinese territorial claims in the disputed South
China Sea.

U.S. officials have said President Hu is likely to visit
the United States early next year — an important but tricky
political trophy for a Chinese leader — and Chinese State
Councillor Dai Bingguo stressed hopes for an amicable
atmosphere.

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For a factbox on tensions click on: [ID:nTOE61B01A])

For an analysis on diplomacy and territorial issues:
[ID:nTOE67307G]

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“Quiet and in-depth dialogue is better than loud
haranguing,” Dai told Summers and Donilon, in remarks made in
the presence of reporters as the two sides sat down for talks.

“At present, in no other relationship between countries is
it more important to enhance dialogue, strengthen mutual
confidence and expand and develop cooperation than it is
between China and the United States.”

As a State Councillor, Dai advises leaders. His ranking in
the ruling Communist Party makes him more powerful within the
government than the Foreign Minister, Yang Jiechi.

BID TO REDUCE FRICTION

The conciliatory comments from Chinese officials indicated
that Beijing wants to keep friction in check, even if deep
differences over economic issues and regional disputes remain.

“There is strong inter-dependence and complementarity
between the Chinese and U.S. economies,” Chinese Vice Premier
Wang Qishan told Summers and Donilon on Monday evening, Chinese
state newspapers reported.

“China-U.S. relations are developing in a generally healthy
way.”

Neither side has said what issues are being discussed
during the two days of talks. Summers’s discussions with
China’s top central banker, Zhou Xiaochuan, and other
policy-makers are likely to include currency and trade issues.

The United States complains that China keeps its yuan
currency undervalued, giving its manufacturers an unfair
advantage against imports and making Chinese exports cheaper.

China unofficially pegged the yuan (CNY=CFXS: ) to the dollar
from mid-2008 to mid-2010, so the currency weakened against
other trade partners as the value of the dollar slid.

China ended that de facto peg on June 19, but the yuan has
since weakened by about 0.33 percent against the dollar, after
appreciating as much as 0.91 percent on Aug. 9.

But Summers and Donilon also took an upbeat public tone.

In comments made before reporters, Summers told Vice
Premier Wang that President Barack Obama “has emphasised for us
the importance he attaches to a very strong relationship
between the United States and China and to President Hu’s
upcoming visit to the United States”.
(Reporting by Chris Buckley; Editing by Ken Wills and Ron
Popeski)

UPDATE 1-China, U.S. aim to ease tensions;Hu visit on agenda