President Obama Welcomes Chinese President Hu to White House

Jan. 19, 2011— -- President Obama formally welcomed Chinese President Hu Jintao to the White House today even as the administration acknowledged that distrust still remains between the United States and China.

This is the first time in history that a Nobel Peace Prize-winning U.S. President has rolled out the red carpet for the leader of a country who has a different Nobel Peace Laureate in jail -- begging the question for some observers: does the U.S. need China more than China needs us?

Those differences were on display at a joint press conference even though the name of the imprisoned Nobel Prize winner, Liu Xiabo, was never mentioned by American or Chinese leaders or reporters.

President Obama said he has raised the issue of human rights with President Hu and that he expects China will change in the years to come.

"We have some core views as Americans about the universality of certain rights: freedom of speech, freedom of religion, freedom of assembly," said Obama, adding that "doesn't prevent us from cooperating in … other critical areas."

Hu declined to answer the question on human rights asked by an American reporter after at first appearing not to hear it through a translator. Pressed later by a second reporter, Hu argued that China has made strides in the area of human rights, but said there are different circumstances in different countries.

"China recognizes and also respects the universality of human rights," Hu said. "At the same time, we need to take into account the different national circumstances. China is a developing country with a huge population, and also a developing country in a crucial stage of reform."

The delicate issue of human rights and historical differences between the countries were accentuated on Tuesday, by comments made by the top Democrat in the U.S. Senate on a talk show in his home state of Nevada.

Senate Majority Leader Harry Reid dubbed Chinese President Hu Jintao "a dictator."

"I am going to go back to Washington tomorrow and meet with the President of China. He is a dictator. He can do a lot of things through the form of government they have. Maybe I shouldn't have said dictator, but they have a different type of government than we have and that is an understatement," Reid said.

Reid will not be attending the State Dinner in Hu's honor Wednesday night, but is scheduled to meet with him on Capitol Hill later in the week.

China's important role in the U.S. economy is also on display at these talks.

"I absolutely believe China's peaceful rise is good for the world, and it's good for America," Obama said.

"We want to sell you all kinds of stuff," Obama told Hu later. "We want to sell you planes, we want to sell you cars, we want to sell you software."

Pegged to today's official state visit at the White House, China will announce a series of commercial deals to purchase $45 billion in U.S. exports, including a $19 billion purchase of 200 Boeing airplanes, a senior administration official said today.

The deal, the White House said, will support 235,000 jobs in the United States.

The investments by the Chinese are in a wide variety of other export sectors -- including agricultural products, computer products, telecommunication and internet equipment, autos and auto parts, engineering machinery, software, and industrial chemical products.

"It's a significant set of contracts and projects for cooperation," the official said. The White House called it a "cross-border collaboration" to contribute to economic growth and development in both countries while emphasizing many clean energy and green technologies.

In addition to the export deals, there will be an announcement of a series of policy changes on China's part.

These include an agreement from China to "strengthen intellectual property right enforcement" by performing and publishing audits showing how government agencies are purchasing software legally. The agreement also includes China's intention to eliminate discriminatory "indigenous innovation" which limits Beijing's purchase of foreign products to those designed in China.

"Chinese investment in the United States, which is one of the things this summit I think is going to address, potentially can generate of a lot of U.S. jobs," said Ken Lieberthal, a senior fellow at The Brookings Institution.

Obama will likely push for China to offer a more level playing field for U.S. products in China, meaning an end to unfair government support for Chinese companies, and to stop the widespread theft of U.S. intellectual property -- such as software and entertainment products.

Perhaps the biggest point of contention between the two nations, Asia experts said, was the issue of China's currency. Obama is expected to once again push China to stop undervaluing its currency and press for greater access for American goods to be sold in Chinese markets.

Chinese Currency on the Agenda

By keeping its currency artificially low, China can produce cheaper goods to sell overseas. The Obama administration says this is unfair to American businesses.

"This is not a tenable policy for China or for the world economy," said Secretary of the Treasury Timothy Geithner last week.

The two presidents will sit down Wednesday afternoon with American and Chinese business leaders from companies like Goldman Sachs, General Electric, Coca-Cola and Boeing. The conversation will center on the U.S.-China economic relationship and increasing trade opportunities between the two nations.

President Obama also plans to announce the creation of a new nuclear security initiative with China - a security center in China with funding from both countries. But no other major breakthroughs are expected. Asia experts said that one key focus for the two presidents is simply mending fences.

"Fundamentally both presidents are trying to signal to both of their populations that this is a relationship that is important to both sides, we ought to find ways to move forward in it," said Lieberthal.

Tuesday night's airport arrival ceremony, a rare honor for a visiting foreign leader, featured Vice President Joe Biden personally greeting the Chinese president on the tarmac. The ceremony marked the start of Hu's two-day visit that included an Oval Office meeting with Obama Wednesday morning, a joint press conference, a meeting with U.S and Chinese business leaders and an elaborate state dinner, only the third such gathering in Obama's presidency.

On Tuesday night in the Old Family Dining Room, Obama held an intimate dinner for Hu. White House officials anticipated that Hu would push for greater access to sell Chinese goods in American markets and more opportunities to invest in the United States.

Administration officials said that Obama would continue to push Hu on the issue of human rights and political reform in China.

"The longer China represses freedoms, the longer it will miss out on these opportunities and the longer that Nobel Prize winners, empty chairs in Oslo will remain a symbol of a great nation's unrealized potential and unfulfilled promise," Secretary of State Hillary Clinton said last week.

Asked Tuesday how tough Obama would be on Hu, White House spokesman Robert Gibbs said he expected the president to continue to raise issues that "are not issues that China wishes to speak about" but Obama discusses because "they are important to our standing in the world and our relationship with the Chinese"

Also on the agenda are national security issues. The two presidents are expected to discuss North Korea's nuclear program, Iran and U.S.-Chinese military relations.

So far the White House has been tightlipped about details for the state dinner, but analysts said that the warm welcome is a clear sign of the importance the Obama administration places on this partnership.

ABC's Matthew Jaffe Contributed to this report