KYOTO, Japan - US President George W. Bush reiterated on Wednesday that Washington supported a "one-China policy" and said that Beijing and Taipei should settle their differences peacefully.

US President George W. Bush gestures during a joint news conference with Japan's Prime Minister Junichiro Koizumi at the Kyoto State Guest House November 16, 2005. [Reuters]

He made the remarks at a joint news conference with his close ally, Prime Minister Junichiro Koizumi, following talks with the Japanese leader.

He said the one-China policy remains unchanged. "It is based on the three communiques, the Taiwan Relations Act and our belief that there should be no unilateral attempts to change the status quo by either side."

Bush said the US will continue to stress the need for a dialogue between the Chinese mainland and Taiwan "that leads to a peaceful resolution of their differences."

US Secretary of State Condoleezza Rice, in her meeting with Chinese Foreign Minister Li Zhaoxing in Busan, South Korea, also said that the US will adhere to the "one-China" policy, stressing that the policy will not change, according to a Xinhua report.

She said China, as a rising power, is playing an increasing important role in the world affairs.

The US cherishes its relations with China, and hopes to maintain a high-level contact with China. Rice said Bush is looking forward to his upcoming China visit.

Chinese Foreign Minister Li Zhaoxing said recent China-US relations have grown steadily, and that the two countries' mutually beneficial cooperation in various fields are fruitful.

Li said properly handling the Taiwan issue is a key to ensuring a steady growth of China-US ties.

He said China appreciates the United States' repeated reiteration that it sticks to the "one China" policy, abides by the three China-US joint communiques, and opposes "Taiwan independence."

Li said China hopes the United States will work together with China to oppose and contain "Taiwan independence" and safeguard the peace of the Taiwan Strait and the China-US relations which are of overall importance.Trade and currency

Bush urged China on Wednesday to act to bring more flexibility to its currency system and to rein in the yawning US-China trade imbalance.

He said that China's access to American markets had played an important role in its development as an economic power and he noted that the United States had supported China's entry into the World Trade Organization.

In return, he said, "China needs to provide a level playing field for American businesses seeking access to China's market."

Amid growing complaints by US politicians, manufacturers and workers about the trade deficit with China and the Chinese currency, Bush faces pressure to take a tough line such issues.

Bush said China had made a "good beginning" on trade with the July revaluation of its currency and with statements made by Chinese President Hu Jintao promising to address the bilateral trade gap and to crack down on the counterfeiting of US music, software and other goods.

But he added: "China needs to take action to ensure that these goals are implemented."

In July, after some two years of intensespeculation in financial markets of a currencyadjustment, China revalued the yuan by 2.1 percent, scrapped an 11-year-old peg to the dollar and said it would allow its currency to appreciate as much as 0.3 percent per day against the dollar.

But since then the yuan has moved little, rising a total of about 0.3 percent against the US dollar over three months.

Chinese officials have repeatedly said they will allow greater yuan flexibility but only gradually.

[1]