Leaders say farewell to Paulson, Beijing's friend in Washington

When US Treasury Secretary Henry Paulson arrived in Beijing this week for the fifth and, for him, final round of the Strategic Economic Dialogue, few people expected substantial results.

They turned out to be right because there were few breakthroughs on the thorniest economic and trade issues between the two sides, such as currency, despite all the talk about progress on many important fronts.

Although the cabinet-level dialogue is hailed by Beijing as a landmark step and an effective mechanism in bilateral ties, it has been a target of criticism in Washington, being perceived as more about form than content. But for Mr Paulson - who has staked his credibility on the high-level talks, which began in 2006 partially at his instigation - there seems to be little reason to worry.

His reputation as China's best US friend and his immense popularity among the Communist Party elite remain high despite his departure next month and a pool of disputes and differences that remain between the two countries, according to analysts.

It was laid bare in Chinese hospitality this week and a list of 'important consensus and agreements' that both sides announced at the end of the two-day meeting. President Hu Jintao and Premier Wen Jiabao also went out of their way to meet him yesterday, in a mark of respect to his decades-long China experience, his connections with state leaders and his contributions to reducing antagonism towards China in Washington.

Fudan University economics professor Zhou Dunren said Mr Paulson was familiar with Sino-US politics and knew co-operation and engagement were the best ways towards an open China market.

He had undertaken a difficult task to increase understanding between the countries, calm China bashers in Washington and try to avoid confrontation, Professor Zhou said. 'While he won applause on Wall Street by urging China to open its market, he has also earned his name in China by persuading Congress not to impose sanctions over China's alleged manipulation of the exchange rate,' he said.