Hu visits Chicago to boost business and China's image

Chinese President Hu Jintao took his roadshow to the U.S. Midwest, where executives from the two countries were set to sign up to 60 deals on Friday to underscore the message that China is open for business.

Leaving behind the rancor of Washington where he was pressed on human rights and currency policy, Hu was feted by the Chicago elite at a gala dinner in U.S. President Barack Obama's hometown.

The Chinese leader was scheduled to wrap up his four-day state visit with stops at a school and a business exhibition.

Across the entire United States, Chicago stands at the forefront in developing relations with China, Hu told the city's mayor, Richard Daley, on Thursday night, the China News Service reported.

As China-U.S. ties develop, there are even broader prospects for local-level contacts and cooperation between our two countries.

Hundreds of Chicago-area and Chinese executives were due to meet and sign deals on Friday at the first U.S.-China Trade and Economic Cooperation Forum, organizers said.

Among the companies expected to announce agreements were China-based computer maker Lenovo Group Ltd, China Telecom and yarn and fabric maker Weiqiao Textile Co Ltd.

U.S. companies with deals included Intel Corp, Microsoft Corp, Advanced Micro Devices Inc, network equipment maker Cisco Systems Inc and Cargill's cotton operation.

BETTER TONE

Analysts said Hu's trip had gone smoothly enough to help set a better tone for the U.S.-China relationship after a flare-up in tensions last year over issues including trade, North Korea and Internet censorship.

The world's top two economies are already closely linked and China is the largest foreign holder of U.S. government debt.

But critics cite a large trade imbalance in China's favor -- some $270 billion last year in the U.S. view -- and accuse Beijing of keeping the yuan weak against the dollar to make Chinese exports artificially cheap.

Some experts saw Hu's trip as the most important U.S.-China meeting in more than 30 years.

Obama has said the relationship between the two countries will help shape the 21st century, while Chinese media lauded Hu's visit as a historic masterstroke in easing tensions.

State television news channels gave blanket coverage to the ceremony of Hu's state dinner and welcome at the White House, in a reflection of China's desire for its leader to be portrayed as a valued and honored player on the world stage.

But the reports largely ignored thornier questions of China's currency policies and human rights record.

U.S. officials touted an acknowledgment from Hu at a joint news conference that more needs to be done on human rights and welcomed $45 billion in export deals with China.

While Hu has not commented publicly about the yuan during the trip, U.S. Vice President Joe Biden said on Thursday there were significant discussions but no specific commitments.

A top Treasury official said on Friday the United States is seeing progress on Beijing's commitment to let the yuan appreciate but more work is needed on that issue and other parts of the U.S.-China relationship.

KOREAN BREAKTHROUGH

Obama appears to have succeeded in convincing China to press its ally North Korea to head into talks with South Korea to try to calm mounting tension on the divided peninsula.

An Obama administration official said on Friday the United States warned China it would redeploy forces in Asia if Beijing failed to rein in North Korea.

Seoul and Pyongyang agreed on Thursday to hold high-level military talks, the first since the North's artillery attack on the South in November.

But experts looking at the U.S.-China summit were cautious about the long-term prospects for dispelling mistrust and of easing strains over China's military buildup and U.S. calls for a more market-oriented exchange rate for the yuan.

On human rights, many activists doubted the comments at the summit would lead to an increase in freedoms in China.

Recently, we've seen a large regression. Hu's statements might be considered a form of progress but the fact is that fundamental rights are still not guaranteed, said rights lawyer Li Fangping. The central government knows this but it has not acted to cure the problem.

One aim of Hu's Chicago trip was to present a more benign image of China to Americans wary of its growing economic might and upset over what they view as unfair trade policies.

The United States was the fifth-largest overseas investor in China last year with $4.1 billion, a 13.3 percent rise from 2009.

Chicago is the financial center of the Midwest, which has many of the products China buys. China, which bought more than half the soybeans exported by the United States last year, also buys cars, steel, pharmaceuticals and construction and farming equipment.