Answer (d) all of the above

“And the best way to foster the innovation that can increase our security and prosperity is to keep our markets open to new ideas, new exchanges, and new sources of energy.”

So said President Obama at the opening of the first round of the Strategic and Economic Dialogue talks between China and the US in Washington yesterday.

Getting some agreement between the world’s two biggest carbon emitters is likely to be crucial to any wider multilateral agreement at Copenhagen in December. As both governments juggle the often competing goals of getting the best deal, making real progress toward an agreement and satisfying their own constituencies,  every word – and its interpretation – counts.

So what was Obama getting at? Several bloggers have had a stab at interpreting them.

Is it…

1. Obama signalling that he does not support the ‘border adjustments’ (In other words, tariffs on carbon-rich imports that, under the current iteration of the Waxman-Markey bill, would come into effect in 2020.) This was the view (originally) advanced by The New Republic.

2. Sharing of intellectual property for clean technology. (As advanced by the WSJ and later H/T by TNR)

3. A reference to China’s apparently increasing protectionism of its own green technology industries? (China Environmental Law).

Whatever Obama was referring to, the important thing is what China makes of the comments – and from past comments and coverage out of the People’s Republic it’s safe to say all these issues are of concern. So far there doesn’t seem to be a lot of reaction specifically to Obama’s comments in the Chinese press, although Charles McElwee of China Environmental Law points to an interview with US Commerce Secretary Gary Locke in which he was asked about the ‘border adjustments’:

During the interview, Locke downplayed questions about US trade protectionism, saying the number of anti-dumping cases filed by the US against China this year is about the same as in 2008 and 2007.

Moreover, he pointed out, the anti-dumping cases were all filed by individual US companies, not the government, and were therefore not indications of official US policy.

Locke acknowledged that it could be difficult to find the right balance between free trade and protecting domestic companies, especially in tough economic times.

As a result, he said, it was especially important to “make sure the competition is fair, even, and level.

Major Chinese news websites have devoted significant resources to covering the talks. And in a comment piece from China Daily, Obama seems to be held in good regard so far:

Barack Obama has consistently outperformed expectations. He was not the favorite to win even the Democratic primaries, let alone the US presidential election. His early lead in the election was expected to wither away after his “fresh new appeal” wore off.

After assuming office, he has been working toward achieving his ambitious objectives, ignoring cynics’ fear of failure. And he has a team of high-performing people who seem to share his belief.

And the optimism doesn’t end there:

WASHINGTON, July 27 (Xinhua) — China and the United States share more common interests than divergences on cooperation in such fields as clean energy, environment and climate change, a top Chinese official said here Monday.

Let’s see how day 2 plays out.

Related links:

In climate change talks between China and the West, nothing is simple (FT Energy Source, 02/06/09)
A glimmer of hope in US-China climate change talks? (FT Energy Source, 10/06/09)

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