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China signed a series of contracts on Wednesday with US companies for billions of US dollars worth of planes, aircraft engines, cars and auto parts to help boost imports from the United States.

Five Chinese airlines have decided to order 30 Next-Generation 737 jets valued at about US$1.7 billion, in a contract signed by a Chinese delegation at the US Department of Commerce.

Zhang Guobao (left), vice chairman of China's National Development and Reform Commission, shakes hands with U.S. Commerce Secretary Don Evans, during a news conference in Washington Wednesday, Nov. 12, 2003, to announce China plans to buy 30 Boeing 737 planes as part of a multibillion-dollar deal with several Chinese airlines. [AP Photo]

The planes are scheduled to be delivered in 2005 and 2006 to Air China, Hainan Airlines, Shandong Airlines, Shenzhen Airlines and Xiamen Airlines.

The Chinese AVIC I Commercial Aircraft Co Ltd also inked a deal with GE Aircraft Engines to purchase GE engines for ARJ21, China's new regional jet aircraft now under development and slated for test flights in 2006.

Representatives from the two companies predicted that 500 ARJ aircraft will be produced in China over the next 20 years, creating approximately US$3 billion of business for GE engines.

The aviation contracts are just two of a series of deals China is planning to purchase more US goods, said Zhang Guobao, vice-chairman of China's National Development and Reform Commission, who is leading a Chinese delegation to the United States.

These purchases are proof that China is making great efforts to expand its imports from the United States to reduce the trade imbalance between the two countries, Zhang said.

US Secretary of Commerce Donald L. Evans also hailed the new contracts.

"They will generate corporate revenue, and they will support high-tech manufacturing jobs in many American communities. This will have a tremendous ripple effect throughout the economy,''Evans said at the signing ceremony.

Also on Wednesday, a Chinese auto industry delegation in Detroit agreed with General Motors (GM) to import cars and auto parts worth more than US$1.3 billion in the coming two years.

Under the first agreement they signed, GM plans to export to China through its subsidiary, GM China, 4,500 complete cars that include the Cadillac CTS Sedans, SRX luxury utility vehicles, XLR roadster and next-generation STS prestige sedans.

The imported Cadillac vehicles will begin to supply Chinese market in mid 2004, according to sources with GM China.

With this agreement, the Chinese Government has authorized the granting of trading and distribution rights one year earlier than required under its World Trade Organization obligations, GM said in its news releases.

The two sides also signed two other agreements on joint ventures in auto production in China.

One of the accords, valued at about US$400 million, is for the supply of components and their assembly for about 13,000 vehicles.

The other involves the supply of about US$700 million of component kits for the Buick Regal sedan and other wagons.

Chinese Vice-Commerce Minister Ma Xiuhong said at the signing ceremony that there has been good and wide co-operation in auto technology, production and trade between China and the United States in the past several years. The market share of American vehicles in China has increased rapidly in recent years, she said.

Ma said she sincerely hopes co-operation between the two countries in the auto industry will improve even further.

She also urged the US Government to ease its restrictions on high-tech exports to China.

Apart from Cadillac cars and auto components, Zhang Guobao in Washington DC said China plans to import a large amount of US agricultural products as well as telecommunication equipment.

Chinese experts at home applauded the deals with the United States, saying the Chinese Government is helping to narrow the trade surplus.

The trade imbalance between the two countries has become a political issue instead of merely an economic one, said Zhang Yebai, a senior Sino-US researcher with the Chinese Academy of Social Sciences.

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