VZCZCXRO1231
OO RUEHCN RUEHGH RUEHVC
DE RUEHBJ #3345/01 2420105
ZNR UUUUU ZZH
O 290105Z AUG 08
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9612
RUEHC/DEPT OF LABOR WASHDC IMMEDIATE
INFO RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC
RUEHOO/CHINA POSTS COLLECTIVE

UNCLAS SECTION 01 OF 03 BEIJING 003345 
 
DEPT PASS USTR FOR KARESH, ROSENBERG, STRATFORD, LEE 
LABOR FOR ILAB AND OSEC 
TREAS FOR OASIA/ISA-CUSHMAN 
USDOC FOR 4420/ITA/MAC/MCQUEEN AND DAS KASOFF 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ELAB PREL OVIP PGOV KOLY CH
SUBJECT: Secretary Chao's August 25, 2008 Meeting with 
Chinese Vice-Premier Zhang Dejiang 
 
(U) This cable is Sensitive but Unclassified.  Please 
protect accordingly. 
 
¶1.  (SBU)  SUMMARY:  Secretary of Labor Elaine Chao met 
with Vice-Premier Zhang Dejiang on August 25, 2008. 
Secretary Chao noted how much President Bush enjoyed the 
Opening Ceremonies of the Olympics and expressed 
condolences from the American government and people 
regarding the Sichuan Earthquake and stressed the 
importance that the President places on the United States- 
China relationship. Vice-Premier Zhang stressed the 
importance of a cooperative relationship between the United 
States and China, explained that China was successful in 
fulfilling its commitments to the Olympics and also relayed 
gratitude to the United States public and private sectors 
in response to the natural disasters that befell China this 
year.  Zhang listed smooth economic development followed by 
inflation prevention as China's main economic priorities, 
noting job creation is one of his responsibilities.  He 
also described the difficulties that China continues to 
face, but expressed that the relationship between the two 
countries has been cooperative and constructive.  Zhang 
looks forward to continued cooperation, which he said 
benefits not only both countries, but also the rest of the 
world.  END SUMMARY. 
 
¶2.  (U)  Secretary of Labor Elaine L. Chao met with Chinese 
Vice-Premier Zhang Dejiang and Minister of Human Resources 
and Social Security (MOHRSS) Yin Weimin on August 25, 2008. 
The following MOHRSS officials were also present:  Vice 
Minister Wang Xiaochu, Director General (DG) Zhang Yali, 
and Deputy Director-General Hao Bin, Zhao Hui (interpreter). 
United States participants included Amb. Clark T. Randt, 
Department of Labor (DOL) Associate Deputy Secretary Anna 
Hui, DOL Deputy Assistant Secretary Jennifer Coxe, Special 
Assistant to the Secretary Alden Sanborne, Embassy Labor 
Officer Bruce Levine, Embassy Interpreter James Brown and 
Econoff Jason Chan (notetaker). 
 
¶3.  (SBU)  Secretary Chao said President Bush enjoyed 
attending the Olympic Opening Ceremonies and stressed the 
importance the President places on the United States-China 
bilateral relationship.  She also expressed condolences on 
behalf of the United States government and people for May 
12 Sichuan earthquake.  The Secretary and Vice Premier both 
said they valued the cooperative bilateral relationship, 
including under the six active letters of understanding DOL 
has signed with its Chinese counterparts.  Secretary Chao 
said that since 2001, her goal has been to improve 
relations with her Chinese counterparts. 
 
¶4.  (SBU)  Vice-Premier Zhang said MOHRSS is satisfied with 
the relationship with DOL and looks forward to continued 
cooperation.  This not only benefits the two agencies, he 
said, but also contributes to constructive bilateral 
relations.  Zhang expressed that the United States and 
China have different experiences, but that they can share 
these experiences and improve.  He said China has its own 
specific circumstances and complexities, and seeks to 
maintain a close and cooperative relationship with the 
United States.  He noted that the United States-China 
relationship is beneficial not only bilaterally, but also 
to the rest of the world. 
 
Successful Fulfillment of Olympic Commitment 
--------------------------------------------- 
 
¶5.  (SBU)  Vice Premier Zhang said there were 204 
delegations in attendance at the Olympics, with newspapers 
reporting 87 medal-winning countries, 51 gold medals for 
China and 43 broken world records.  He said it was a grand, 
unprecedented event, and congratulated the United States on 
winning 111 medals.  Since winning the bid in 2001, he 
explained, the Chinese government has adopted the motto of 
a "green, technological, and people's Olympics" in the 
spirit of a swifter, higher, and stronger Olympics.  He 
said that China has fully honored its commitments with a 
successful 29th Olympics, and that China will continue to 
work hard during the Paralympics. 
 
¶6.  (SBU)  Secretary Chao said the eyes of the world were 
on the Chinese people for their preparation and staging of 
 
BEIJING 00003345  002 OF 003 
 
 
the Olympics.  She noted that several prominent Americans 
stated that China had shown itself spectacularly under a 
new light.  She said the closing ceremonies were 
spectacular, and that the United States Presidential 
delegations to both the opening and closing ceremonies 
equally enjoyed the Olympic ceremonies and events. 
 
Social Security Reform Difficult in China's 
Complex Society 
-------------------------------------------- 
 
¶7.  (SBU)  Vice-Premier Zhang stated that China hopes to 
improve the social security situation for all people by 
2020, especially with medical care, a pension system, and 
other social insurance programs that cover urban and rural 
areas.  He explained that foreigners have a difficult time 
understanding China because of its long history, large 
geographical area, 56 nationalities and regional 
differences, which are further complicated by the urban- 
rural, intra-provincial and even intra-county differences. 
He said it is very important to consider the reality of 
China and that a one-size-fits-all approach cannot be 
expected.  Therefore, Zhang stated that the employment, 
labor and social security system must fit Chinese reality. 
 
¶8.  (SBU)  Zhang mused that during the first half of 2008, 
the world economy was extremely complex with the 
depreciation of the United States dollar, appreciation of 
the Chinese yuan (RMB) and the inflation of oil and natural 
resource prices.  However, he said the Chinese economy was 
able to remain healthy and stable with gross domestic 
product (GDP) growth of 10.4%.  He listed China's economic 
priorities as smooth economic development followed by 
inflation prevention, noting that one of his tasks is job 
creation.  He explained that China has a huge population 
and is still a developing country.  The need to create 10 
million new jobs each year is a big challenge.  Active 
employment policies combined with new laws and regulations 
such as the Labor Law, Employment Promotion Law, and Labor 
Arbitration Law help to both promote employment while also 
keeping workers' interests in mind, he said. 
 
¶9.  (SB)  Zhang noted Secretary Chao's visits to Chinaand 
her familiarity with labor and social secrity issues, and 
said she can appreciate the roblems  created by a 
population of 1.3 billion people.  He explained that 760 
million rural residents and more than 600 million urban 
residents create a rural-urban divide.  The most pressing 
task is the social security system and extending it to all 
citizens.  As a former Provincial Party Secretary in Jilin 
and Guangdong provinces, Zhang stated that he understands 
these disparities first hand.  He explained that Jilin is 
an old industrial base with a large agricultural sector, 
while Guangdong is close to Hong Kong and at the forefront 
of China?s reform and opening up.  He stated that the 
United States is the world?s most developed country that 
has rich experience in the relationship between employment, 
labor, and social security.  He noted that China can learn 
from the United States to improve and enhance China?s own 
system. 
 
¶10.  (SBU)  Secretary Chao thanked Zhang for expounding on 
these important topics.  She noted the good relationship 
with the previous Ministry of Labor and Social Security 
(MOLSS) and the present MOHRSS.  Since 2001, she 
explained,her goal has been to establish better relations 
between her Department and its Chinese counterpart.  She 
referred to the six letters of understanding already signed 
with MOHRSS and the State Administration for Work Safety 
(SAWS) and another agreement with former MOLSS Minister 
Tian, which underpin continued dialogue and mutual 
understanding.  The agreements are beneficial because, 
through their different experiences, the agencies can share 
their experiences and lessons.  She noted that she was 
pleased to be able to meet Minister Yin on this visit and 
discuss issues of mutual concern. 
 
DOL-MOHRSS?s Cooperative Relationship 
------------------------------------- 
 
¶11.  (SBU)  Vice-Premier Zhang noted that Minister Yin had 
spoken of the cooperative relation between DOL and MOHRSS, 
 
BEIJING 00003345  003 OF 003 
 
 
and hoped that the relationship improves and deepens 
further.  He commented that as a veteran Secretary, 
Secretary Chao has had rich experience with China and labor. 
He said he hopes the two ministries will continue to 
deepen their cooperation.  Zhang noted that the United 
States-China relationship is beneficial not only to the two 
countries, but also to the world.  He remarked that the 
agreement between President Bush and President Hu to build 
a constructive and cooperative relationship was a strategic 
decision, and Zhang said he hopes the relationship will 
continue to develop along these lines. 
 
¶12.  (SBU)  Secretary Chao noted that there would be many 
opportunities for discussion and cooperation in the future, 
including the Joint Commission on Commerce and Trade (JCCT) 
in September, 2008 followed by the Strategic Economic 
Dialogue (SED) in December.  She said President Bush refers 
to the United States-China relationship as one of the most 
important relations in the world.  She noted that MOHRSS 
and DOL cooperate candidly to ensure that the relationship 
continues thus. 
 
Condolences for the Sichuan Earthquake 
--------------------------------------- 
 
¶13.  (SBU)  Secretary Chao conveyed the condolences of the 
government and people of the United States for the May 12, 
2008 Sichuan earthquake.  Vice-Premier Zhang noted that in 
the spring, China?s electricity and transportation network 
was greatly impacted by a major snowstorm.  In May, China 
was hit by a devastating earthquake.  The government of 
China follows a 'people first' policy (yi ren wei ben), he 
said, so a great effort was put forth in both relief 
periods.  He expressed sincere gratitude for the assistance 
and support from the United States? public and private 
sectors. 
 
¶14.  (U)  Secretary Chao cleared this message. 
 
RANDT