P 040939Z FEB 09
FM AMCONSUL HONG KONG
TO SECSTATE WASHDC PRIORITY 6815
INFO WHITE HOUSE WASHDC
USDOC WASHDC
AMEMBASSY BEIJING 
AMCONSUL SHANGHAI
AMCONSUL GUANGZHOU 
AIT TAIPEI 0190
CDR USPACOM HONOLULU HI

UNCLAS HONG KONG 000210 
 
 
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TAGS: OPRC KMDR
SUBJECT: MEDIA REACTION: IRAN 
 
TOPIC: Iran 
 
Global economy 
 
HEADLINES AND EXCERPTS: 
 
"U.S. should lead by example during crisis" 
 
The independent English-language South China Morning Post said in an 
editorial (2/4):  "Central bankers are expected to try to calm 
markets and ease the anxiety of investors in times of crisis.  So 
the warning by Hong Kong Monetary Authority chief Joseph Yam 
Chi-kwong of a second, even more serious, wave of financial turmoil 
is disconcerting.  After what the credit crunch has done, it is hard 
to imagine an even more damaging second hit....  The world cannot 
recover until its largest economy has.  But the U.S. cannot blindly 
pursue beggar-thy-neighbor policies to pull itself out of a hole. 
It is hoping to continue to exploit its position as the issuer of 
the world's reserve currency by selling more IOUs in the form of 
U.S. Treasury bills and printing money backed by nothing but the 
good name of the U.S. government.  The U.S. should be reminded of 
its global responsibility to help struggling economies.  It should 
allow its overseas creditors to lay claim to real U.S. assets such 
as those it already owns in the financial and mortgage sectors from 
federal bailouts.  This will quickly attract foreign investment and 
boost economic recovery. Americans have been fond of lecturing 
others on the evils of failing to open their economies and of 
pandering to nationalist sentiments.  It's time for the U.S. to 
practice what it preaches." 
 
"Reviving protectionism, Obama has run out of tricks" 
 
The independent Chinese-language Hong Kong Economic Journal said in 
an editorial (2/4):  "The financial crisis has resulted in economic 
recession.  Protectionist sentiments in the U.S. are running high. 
The House of Representatives passed the 'Buy American' provision in 
the economic stimulus plan on January 28.  The provision has raised 
concerns and debates in many countries.  In an interview with The 
Time, the British Business Secretary Mandelson criticized a 
provision in Obama's economic stimulus plan for prohibiting 
foreign-made steel from being used in U.S. projects paid for by the 
economic rescue package.  He said that kind of trade protectionism 
provision will certainly trigger trade confrontations.  It is a 
'poison'.  In response to U.S. Treasury Secretary Geithner's 
accusation that China is manipulating the yuan, China also believes 
the U.S. is using the exchange rate argument as justification for 
the trade barriers it will set up later.  The Heritage Foundation, a 
conservative U.S. think tank, recently wrote an article rejecting 
the 'Buy American' provision, under the title, 'Buy American Hurts 
American'.  The writer said that 'Buy American' cannot save the 
U.S., and on the contrary, it will create grave consequences which 
will hurt others and itself." 
 
DONOVAN