![]() |
||
![]() |
September 21, 2006 Treasury Secretary Henry Paulson Press Briefing (The following has been edited to remove most unintelligible sections but may contain misunderstood or unintelligible words.) SECRETARY PAULSON: Good evening, everyone. Sorry to keep you waiting. The banquet went a little longer than expected, but it was a good banquet. As I said at the press conference that Madame Wu and I had, the relationship between the Now, what President Bush asked me to do was to coordinate across the various economic issues. And it's important to do this, because only by doing this will we be able to prioritize it in such a way that I will be able to represent the best interests of the American people as effectively as possible. And that is very important because as we look forward and as we manage this relationship, it's going to be very important that the benefits that come from economic growth are shared equitably in both countries. And regrettably, there's a sense in the QUESTION: Some people think that on some level, this is like a consolation prize because you're going to leave here without anything concrete on the currency. Can you address that and also can you address what we're hearing from trade groups in the States who are concerned about what they say is a softening line on current trade. SECRETARY PAULSON: All right. Yeah. Okay. Well, let me take both issues. First of all, in terms of the objective here, I think I've been pretty consistent from day one of saying when you're talking about something as important and fundamental as an economic relationship. I don't think I ever indicated to anybody that I was going to make any first trip to And secondly, I knew there were going to have to be some results in the short term. And you always have to get through the night if you want to get to the longer term. So again, let's not confuse results with process. I think what we've done here is put a process in place which, based upon my experience, I believe gives us the best chance of getting the results that we're going to need to get over the next two years and for many years in the future. This is, I think, an important step, and it's a step that maximizes our chance of getting results. To me, the key thing always in working with the Chinese is to be able to get access to all the right people at the right level and have a process where there's a real discipline. And the fact that we will have this dialogue in place and we'll have the big meetings twice a year and a lot of work in between gives us the best chance of maximizing our success. But again, I never expected and I think I've been pretty clear in saying that I never expected anything other than a first set of discussions. Yes? QUESTION: I have three questions to ask. SECRETARY PAULSON: Well, I think what we'll do is I may ultimately want you to ask all three questions, but I'm not sure. I may be here for a half an hour or 45 minutes or whatever, but I want to give everybody else a chance to ask questions, too. So I'll let you ask your first question and then I'll come back if we have time for others. QUESTION: Okay. Which one do you prefer, the weak dollar or the strong dollar, and why? SECRETARY PAULSON: What did you say? QUESTION: Which one do you prefer, the weak dollar or the strong dollar, and why? SECRETARY PAULSON: Okay. Well, I would say to you that – and I think I've been pretty clear on this – a strong dollar is in our nation's interest. And our currency values are always determined – and I believe they should be determined – in a fair, competitive marketplace based upon underlying economic fundamentals. And so what we do in the QUESTION: What steps have you taken or are you going to take to try to sell this project to Congress? SECRETARY PAULSON: I don't think I have a need to sell this project to Congress. This is a process. Okay? And I think it's the President's job and it's my job to design a process for working with the Chinese that will give us the best results. And I think Congress is going to judge me by the results that I get and this administration gets over a period of time. I know there's a short-term mentality in the world today, but I don't think many people are going to judge me by what comes out of one visit. And if they do, heaven help this country. Yes… QUESTION: Thank you. You talk about the need for SECRETARY PAULSON: The -- of course in the longer term, we all know what it is. Okay? In the long term it is an exchange rate that is where the currency's value is set in the competitive marketplace. We're not going to be able to get there until we get QUESTION: Mr. Secretary, could you address the recent events in SECRETARY PAULSON: I would say I've been traveling so I'm not on top of this on a minute-by-minute basis, but I would note that there's been very little dislocation in the Thai capital markets. No spill over in the global capital markets. So it's always very regrettable when you see a change take place this way in a democracy. From that standpoint it's something we've all got to look at with regret. But in terms of the economic impact – and I don't mean to say that an adverse development isn't possible – but if I'm thinking about the top five or six things I'm worrying about today, that isn't on the list. Yes? QUESTION: Thank you. I'm from China Business News. I wonder, Citibank tried to merge with Guangdong Development bank, but they faced a lot of problems from (Translated from Chinese) There are many restrictions from the Chinese government on the potential deal of Citigroup to acquire Guangdong Development Bank. How do you comment on this as the former Chairman and CEO of Goldman Sachs? In addition, can you update the status on the issue of possibly cutting off financial connections with SECRETARY PAULSON: Okay. Remember, I said one question, but I'm going to, just for you, do two questions, but that's the only one. From now on we're going to do one question. Now, in terms of the Citigroup transaction, which I haven't followed closely on a day-to-day basis, I will just say to you that I am a very strong advocate of this country opening up its capital markets to foreign investment. I believe when they open up and let foreign competition in, the biggest beneficiary will be Now, in terms of the Iranian situation, I have nothing new to report other than what I said the other day, which is I'm a big believer in the fact that the role of the Treasury Secretary of the U.S. and financial ministers around the world is to keep our financial system safe, sound, and secure. And you can't have a secure financial system, you can't preserve the reputation of a financial system if you let people come in and abuse it and abuse it for illegal activities of any kind, whether WMD proliferation or terrorism. Now as far as the effort I think you're referring to, there are two efforts and they're related, but they are different. Bank Saderat has been sanctioned. Separate and apart from that we had noticed that the Iranians were using a series of devices that were very misleading to infiltrate the system and trick a number of banks around the world. And so we went around and we talked to those banks and we talked to them as part of an educational program to help them understand the risks. And as far as I know, they all were very grateful for the assistance. A number of them learned things, and I think that that will be an important step in helping maintain the integrity of our banking system around the world. Yes? QUESTION: Mr. Secretary, you alluded to voices in the SECRETARY PAULSON: I wouldn't want to predict when there should be the concrete results, but I'm not famous for being very patient. Okay? Check with anybody who's worked with me. But I really don't believe it is appropriate to carry on negotiations in a public forum. Behind closed doors I'm pretty aggressive as a persuader, as an advocate. But I've spent my career doing negotiations, and where I come from, it's appropriate to do negotiations in private. Yes, the man at the back. QUESTION: I'm from [inaudible] TV from SECRETARY PAULSON: I missed your question. Is there a time frame for -- for what case? QUESTION: As a sanction on the DPRK, but was there any specific timetable for investigation into Banco Delta Asia? And when you met Korean President Mr. Roh, was there a request from Mr. Roh to hasten the speed of investigation on Banco Delta Asia? SECRETARY PAULSON: Let me say that I met with President Roh. It was a very good meeting, but it was a confidential meeting. And again, it would be inappropriate for me to divulge publicly what I'm talking about when I'm meeting with an important head of state or when I'm meeting with anyone in private. That's number one. But to your question, no, there is no prescribed time frame. This is a law enforcement matter, and it will take as long as it takes to resolve it appropriately. Thank you. Yes, the woman in the farthest back. QUESTION: Okay. Thank you. I'm from Xinhua News Agency. I know that you have met with Minister Ma Kai this afternoon. SECRETARY PAULSON: Yes. QUESTION: Yes. And later you will meet with the Chinese top leaders Hu Jintao and Wen Jiabao. So we just want to know that SECRETARY PAULSON: Yeah. Well, thank you for that question, because I think the one thing I have said that I'm going to talk about, because I don't think it's divulging any confidences and it's pretty clear how I feel, I'm going to encourage them to move ahead with all of their reforms and the things they said they were going to do and move forward even more quickly. And when I look at The pace of change has been quick and it's been remarkable. But my view is that the biggest danger that QUESTION: Yes, thank you. I'm from SECRETARY PAULSON: Okay. Let me just see if I can figure out -- I'm not great at these high-tech things here, but I think I'll figure it out. QUESTION: (Translated from Chinese) Thank you. I notice from your news documents that neither People's Bank of China nor China Securities Regulatory Commission nor China Banking Regulatory Commission is included in the dialogue mechanism. Before your trip to SECRETARY PAULSON: Well, I got your question. The financial supervisors who are looking at the markets in But to get more specifically to your question, the issues they confront are a domestic market that is really an equity market that is quite small relative to the size of the country. There's very little of an institutional market to speak of. It's largely a retail market. Most of the equities that have been issued in this market are state-owned enterprises where there's still the big overhang. Many of the best offerings have been sold outside of QUESTION: Thanks. Some members of Congress have promised to put through their legislation imposing some sanctions on Chinese products. If your visit doesn't give them what they want, what do you think the possible action is? SECRETARY PAULSON: Well, I don't want to speculate about actions others may take. I know you're talking about Senators Schumer and Graham. They are knowledgeable about QUESTION: Thank you. I'll speak Chinese. Can we…? (Translated from Chinese) Thank you. From your answers to the questions, I can see that you are very familiar with the current Chinese economic situation and economic development. As far as I know, you have visited SECRETARY PAULSON: Well, my source of knowledge is talking to a lot of people, reading a lot of things, but the best knowledge comes from being right here and having done business, having, as an investment banker, worked with the government on privatizations, worked with the private companies in the marketplace and experienced it on a firsthand basis. And I am a – like everyone else I know who has spent time here – I'm a huge proponent of and believer in the Chinese economy. And to me it starts with the people, the great human resource for quality and the talent and the commercial talent of the people. And then you get to a group of leaders who are very smart and knowledgeable, pragmatic, results-oriented, looking everywhere for best practices, finding things that will work and implementing them. And so it is a strong and growing economy. My own view is, though, that you can't take the past success and automatically extrapolate it and just assume it's going to keep growing like this and pass all the other economies in the world, because this economy still needs to make the transition from being based on low-cost labor and assembling and manufacturing well-value-added products to developing a more complex economy. And I have every confidence that will happen. But in my judgment, for that to happen, you'll have to continue to make the transition to using market-based devices as opposed to administrative. And that means speeding up the reforms. It doesn't take any magic. Your leaders have already identified what needs to be done. They stated what needs to be done. I believe they're right. They just have to do it. MODERATOR: Last question. SECRETARY PAULSON: Okay. Last question. Who hasn't asked a question? Only put your hand up if you haven't asked one. Yes? QUESTION: Secretary Paulson, you and Madame Wu have each been nominated to represent the SECRETARY PAULSON: First of all, let me say I have got huge confidence in Madame Wu. She knows how to get things done. She's pragmatic. She's aggressive. As we say in the And so again, I'm very enthused about the process. But you're not going to get me declaring a victory because we set up a process. A process is only a process. It's a means to the end, and this process will be judged by the results it achieves. Thank you all very much for staying here so late and have a good evening. MODERATOR: Thank you.
|
![]() |