VZCZCXRO0323
RR RUEHCN RUEHGH RUEHVC
DE RUEHBJ #0801/01 0850837
ZNR UUUUU ZZH
R 260837Z MAR 09
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC 3103
INFO RUEHOO/CHINA POSTS COLLECTIVE
RHMFIUU/CDR USPACOM HONOLULU HI

UNCLAS SECTION 01 OF 02 BEIJING 000801 
 
DEPARTMENT FOR INR/R/MR, EAP/CM, EAP/PA, EAP/PD, C 
HQ PACOM FOR PUBLIC DIPLOMACY ADVISOR (J007) 
SIPDIS 
 
E.O. 12958:  N/A 
TAGS: OPRC KMDR CH
 
SUBJECT: MEDIA REACTION: G20 SUMMIT, NORTH KOREA 
 
-------------------- 
  Editorial Quotes 
-------------------- 
 
G20 Summit 
 
a. "The U.S. rashly responds to China's suggestion" 
 
The official Communist Party international news publication Global 
Times (Huanqiu Shibao)(03/24): "The Director of the People's Bank of 
China suggested the creation of a super-sovereign international 
reserve currency. The influence of this article has continuously 
spread. U.S. Treasury Secretary Geithner and Federal Reserve 
President Bernanke have both reacted to the suggestion that the U.S. 
should give up the USD. It is surprising that many American 
officials reacted to this issue in such a sensitive way.  The USD's 
importance to the national position of the U.S. can be compared to 
the power of the U.S. aircraft carriers whose presence is felt in 
many oceans. 
 
Meanwhile, internationally, the public have given much understanding 
and sympathy towards this issue because China, as a country holding 
a large amount of American dollars, is airing its worries.  Chinese 
analysts believe that although it would be difficult to create a new 
international reserve currency, it would not be impossible. China's 
decision to show its stance on the issue is obviously beneficial in 
reducing any wrong judgments on China's financial strategies.  He 
Weiwen, from the American Economic Association of China, says that 
the dominant position of the U.S. dollar stands for America's 
dominance in the world.  Therefore, America is very sensitive 
towards the suggestion of creating a super-sovereign international 
reserve currency. 
 
After World War II, U.S. dollars played an active role in promoting 
global trade and economic development, however, the U.S. government 
has, consciously or unconsciously, misused the special international 
position of U.S. dollar when making domestic policies.  Obama's 
series of measures to stimulate the capital flow reminds people of 
the way America traditionally handles its economic troubles: by 
over-issuing dollars in order to transfer the influence of the 
financial crisis to others. Chinese scholars say that America's 
domestic policies can significantly impact other countries, and that 
there are no hard restraints for U.S. 
 
Such rights and responsibilities are unbalanced. He Weiwen also 
points out that the U.S. often utilizes the dominant position of 
U.S. dollar for its own benefit, especially during a crisis. 
Therefore, using the U.S. dollar as an international reserve 
currency is not at all reasonable.  A researcher from China 
Institute of International Studies said that America will definitely 
secure the U.S. dollar's dominance at the G20.  The U.S. should be 
aware that they need to stimulate the economy and think about 
international interests; otherwise, sooner or later the U.S. dollar 
will be abandoned." 
 
b. "The U.S. used their detoxifying plan to 'give in' during the 
G20" 
 
The official Xinhua News Agency international news publication 
International Herald Leader (Guoji Xianqu Daobao)(03/26):"Geithner 
has announced a plan that would help U.S. banks let go of their 
toxic assets. Finally, this plan has brought the support of the U.S. 
government. Chinese analysts are reminded that the objective of the 
U.S. is worth a second look given that his plan was put forward just 
before the G20 Summit. Wang Rongjun, from the Chinese Academy of 
Social Science, thinks that dealing with the toxic assets is one of 
the keys to stabilize the American financial market and solve the 
credit crunch problem. 
 
This plan could provide help and is a much more targeted and more 
operable plan than the other financial stimulus plans.  Though this 
plan is welcomed by the market, there are also questions regarding 
the side effects it may bring, especially concerning the issuing of 
loans which may result in a further devaluation of the U.S. dollar. 
An expert from Renmin University says that the top priority for the 
U.S. is to handle the short term problem--deflation, and deal with 
the long-term side effects when they appear. 
 
However, other Chinese analyst thinks that this plan is a strategic 
move by the U.S. government. The financial strength of the U.S. is 
very powerful. By only looking at what is on the surface, one cannot 
see the real problems of the U.S. financial system. Before the G20, 
the U.S. is trying to tell the world that America is facing serious 
problems and hoping that other countries will invest their capital 
into the IMF.  At this time, U.S. dominance in the world is 
threatened. We need to evaluate this plan based on long-term effect 
rather than short-term influence.  When we analyze the whole thing, 
we should learn from past lessons and find out what the future 
concerns and intentions of U.S. are. The verity and the transparency 
 
BEIJING 00000801  002 OF 002 
 
 
of the U.S. stimulus packages are not good, which creates a lot of 
uncertainty for people." 
 
North Korea 
 
a. "North Korea plays the game 'farmer and the wolf' with the U.S. 
and Japan" 
 
The official Xinhua News Agency international news publication 
International Herald Leader (Guoji Xianqu Daobao)(03/26): "Although 
North Korea insists that it will only launch a satellite, the U.S., 
Japan and South Korea believe that it will be a missile. U.S., 
Japan, and South Korea are in a dilemma.  On the North Korean issue, 
the U.S. must consider the concerns of its allies. Japan had to make 
a large effort, based on their laws, in order to explain their 
intention to intercept North Korea's missile. According to Japanese 
law, they are allowed to shoot down a missile if it is aimed at 
Japan. However, Japan hopes not to have to take this action, 
intensifying the situation with North Korea.  South Korea, without 
relatively efficient anti-missile measures is worried about North 
Korean troops aiming at its capital and standing at its border. It 
is like a "mouse in a blower", who has to suffer the threats from 
both sides.  America's "red line" can't stop the North Korean 
satellite.  The U.S.-North Korean relationship is like that of the 
game 'farmer and the wolf'. The farmer told the wolf not to steal 
more than 5 chickens.  If the wolf steals only four chickens, the 
farmer can only admit that fact by having to adjust his own 
behavior.  This is just like what has happened in the U.S.-North 
Korea nuclear negotiations.  North Korea will absolutely have reason 
to "be the one who laughs the loudest" on the issue of "launching a 
satellite"." 
 
 
PICCUTA