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Cablegate: Codel Murray: Economic Cooperation -- Not Taiwan Arms --

VZCZCXRO4676
RR RUEHCN RUEHGH
DE RUEHGH #0021/01 0220346
ZNR UUUUU ZZH
R 220346Z JAN 10
FM AMCONSUL SHANGHAI
TO RUEHC/SECSTATE WASHDC 8490
INFO RUEHBJ/AMEMBASSY BEIJING 3257
RUEHCN/AMCONSUL CHENGDU 2350
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUEHGZ/AMCONSUL GUANGZHOU 0807
RUEHHK/AMCONSUL HONG KONG 2522
RHEHAAA/NSC WASHINGTON DC
RUEHSH/AMCONSUL SHENYANG 2341
RUEHIN/AIT TAIPEI 2139
RUEHGH/AMCONSUL SHANGHAI 9157

UNCLAS SECTION 01 OF 03 SHANGHAI 000021

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: PREL SENV ECON EINV PGOV KIPR OVIP MURRAY PATTY
CH, TW
SUBJECT: CODEL MURRAY: ECONOMIC COOPERATION -- NOT TAIWAN ARMS --
HIGHLIGHTED IN DISCUSSIONS WITH SHANGHAI LEADERS

(U) Sensitive but unclassified. Not for dissemination outside
USG channels; not for Internet distribution.

1. (SBU) Summary: Shanghai Municipal leaders highlighted
U.S.-China trade and investment cooperation in their meetings
with CODEL Murray on January 15. Municipal Communist Party
Secretary Yu Zhengsheng focused on the transportation sector in
particular, pointing to General Motors (GM) and General Electric
(GE) as examples of positive cooperation. Neither Yu nor
Shanghai Municipal People's Congress Vice Chairman raised the
question of U.S. arms sales to Taiwan with Senator Murray and
her colleagues, suggesting the Central Government's rhetoric on
this issue has little resonance with local Chinese leaders whose
chief priority remains economic development. End Summary.

Shanghai Party Secretary: Economy Rolling Along

--------------------------------------------- ---

2. (SBU) Shanghai Municipal Communist Party Secretary Yu
Zhengsheng opened the January 15 meeting with CODEL Murray by
remarking that President Obama's November 2009 visit to Shanghai
was "very successful" and served to underscore the positive and
constructive nature of the U.S.-China relationship. Shanghai's
economy appears to have withstood the worst of the global
financial crisis, Yu said, giving partial credit to U.S.
business investment in the city. Yu emphasized ongoing
cooperation with General Motors (GM), noting that GM's
production in Shanghai increased by approximately 50 percent in
2009. While it is unlikely the coming year will be able to
duplicate the same level of success, Yu observed that domestic
consumers' behavior has been the driving force behind GM's
success in Shanghai.

3. (SBU) Party Secretary Yu discussed new business projects
between the United States and China with strong Shanghai
involvement, including a deal to build several nuclear power
plants. He claimed American nuclear power technology was far
more advanced than that of other countries, including France and
Russia. Yu also mentioned a new project with General Electric
(GE) to produce airplane engines in China. The strong economic
cooperation between the U.S. companies and Shanghai, Yu claimed,
would contribute to the industrial growth of both the United
States and China.

Municipal People's Congress: Focus on Infrastructure

--------------------------------------------- -------

4. (SBU) In a separate meeting and lunch, Shanghai Municipal
People's Congress (SMPC) Vice Chairman Hu Wei stressed that
Shanghai has many economic and trade connections with several
U.S. cities. Shanghai's GDP grew by 8.7 percent in 2009 due in
large part to these ties with the United States. Currently,
Shanghai is engaged in major infrastructure development for the
Shanghai 2010 World Expo. In view of the Expo's theme of
"Better City, Better Life," the Shanghai Municipal Government is
striving to improve environmental protection, he said, adding
that the municipal government's goal is "cleaner air and cleaner
water." However, he acknowledged that Shanghai has many
challenges, especially in the transportation sector. In
addition, Shanghai has too many skyscrapers and the municipal
government has sought to improve "green" measures for tall
buildings.

5. (SBU) SMPC Vice Chairman Hu said while the United States and
China have many differences, there are more reasons to

SHANGHAI 00000021 002 OF 003


cooperate, especially in terms of business. During lunch, Hu
and Senator Murray agreed that there needs to be increased
bilateral cooperation on intellectual property rights (IPR)
protection. Hu also emphasized that the Shanghai Municipal
Government wants to bolster its economy through green
technology.

Comment: Shanghai Leaders Avoid Taiwan Issue

--------------------------------------------

6. (SBU) Comment: What was not said was perhaps the most notable
point of the Senators' meeting with Yu and Hu. Neither Party
Secretary Yu -- a member of the Communist Party's Politburo and,
thus, nominally belonging to China's "central" leadership -- nor
SMPC Vice Chairman Hu raised the issue of Taiwan arm sales, the
topic which dominated the CODEL's Beijing discussions. The
silence on this subject in Shanghai suggests the Central
Government's harsh rhetoric on possible Taiwan arms sales by the
United States has little resonance among local Chinese political
leaders who continue to see the relationship with the United
States primarily as an avenue to foster economic development.
End Comment.

Meeting Participants

--------------------

7. (U) U.S. Participants at both meetings

Senator Patty Murray

Mr. Rob Murray, husband of Senator Murray

Senator Christopher Bond

Senator Roland Burris

Mr. Evan Schatz, Legislative Director, Office of Senator Murray

Mr. C. Michael DuBois, Senior Legislative Assistant, Office of
Senator Bond

Mr. Travis Lumpkin, Legislative Assistant, Office of Senator
Murray

LTC Rich Root, U.S. Army Senate Liaison Office

LT Justin Cox, Office of Attending Physician

Ms. Beatrice Camp, Consul General, U.S. Consulate

Ms. Fei Yuying, Interpreter, U.S. Consulate

Mr. Jessup Taylor, Notetaker, U.S. Consulate

8. (U) Chinese Participants at Party Secretary Yu Meeting

Yu Zhengsheng, Secretary, Shanghai Municipal Party

Jin Mao, Member, Foreign Affairs Committee, National People's
Congress

Yao Mingbao, Secretary General, Standing Committee, Shanghai
Municipal People's Congress

Ding Xuexiang, Secretary General, Municipal Party Standing

SHANGHAI 00000021 003 OF 003


Committee

Li Mingjun, Director, Shanghai Municipal Foreign Affairs Office

Peng Fang, Director, Foreign Affairs Office, National People's
Congress

Wang Zhong, Vice Director, Budget Committee, Shanghai Municipal
People's Congress

9. (U) Chinese Participants at Vice Chairman Hu Lunch and Meeting

Hu Wei, Vice Chairman, Shanghai Municipal People's Congress

Jin Mao, Member, Foreign Affairs Committee, National People's
Congress

Yao Mingbao, Secretary General, Standing Committee, Shanghai
Municipal People's Congress

Peng Fang, Director, Foreign Affairs Office, National People's
Congress

Wang Zhong, Vice Director, Budget Committee, Shanghai Municipal
People's Congress

Wu Jinlan, Deputy Director, Foreign Affairs Office, Shanghai
Municipality

Xu Yi, Deputy Director, Standing Committee Office, Shanghai
Municipal People's Congress

10. (U) CODEL staff cleared this cable.
CAMP

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