Geithner tries to assure Chinese investors, draws laughter from the audience

Quotes from the Great Depression

timothy-geithner Mr Geithner is on a two-day visit to Beijing, America’s biggest creditor

US Treasury Secretary Timothy Geithner has told the Chinese government its investments in the US are “very safe”, despite a growing budget deficit.

Mr Geithner is on his first official visit to China, the biggest foreign investor in US treasury bonds.

Ahead of meetings with President Hu Jintao and Premier Wen Jiabao, he said the US and China must work together to fix the global economic system.

Mr Geithner said the US would move swiftly to get its debt under control.

In a speech at Beijing University at the start of his two-day visit, Mr Geithner reassured his Chinese hosts that they need not worry about the estimated $770bn (£475bn) they have invested in US treasuries, a class of US government debt.

“Chinese financial assets are very safe,” he said, drawing laughter from the audience.

He will be hoping that China’s president and premier take his reassurance more seriously, because America needs China’s confidence, and its money, says the BBC’s Quentin Sommerville in Beijing.

‘Better shape’

Mr Geithner said the global recession was losing force, and the world’s financial system was starting to heal.

“We are seeing more durable stability in the economy and the financial system is in substantially better shape,” he said.

“But we have a ways to go and we need to keep working in the United States and with the other major economies to restore conditions for a sustainable recovery,” he said.

He made only the briefest reference to a topic of sharp disagreement – China’s currency. America says it is undervalued, making Chinese exports cheaper and costing US jobs.

But he did not push the point too hard, perhaps because, as he said, global problems would not be solved without the US and China working together, our correspondent says.

Page last updated at 09:23 GMT, Monday, 1 June 2009 10:23 UK

Source: BBC News

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