Chinese officials have signed a raft of lucrative contracts with aircraft manufacturer Airbus and French energy giants Total and Areva during a visit to France by China's President Hu Jintao.
REUTERS - Chinese President Hu Jintao oversaw the signing of multi-billion dollar aircraft and nuclear fuel contracts with French companies on Thursday and pledged close cooperation as Paris prepares to take over the G20 presidency.
As Hu kicked off a two-nation European visit aimed at smoothing trade tensions, Chinese officials signed contracts to buy 102 Airbus planes and deals with Areva to build a nuclear-fuel treatment factory in China and supply uranium over 10 years. The contracts totalled $20 billion.
Chinese Deputy Foreign Minister Fu Ying said Hu had given his backing to President Nicolas Sarkozy's agenda for the G20 presidency, and also said China would double its annual trade with France to $80 billion over the next five years.
Hu's three-day state visit to France, after which he travels to Portugal, comes at a time when EU leaders have closed ranks with Washington in urging China to allow its yuan currency to appreciate more quickly, unsettling relations between Beijing and Brussels.
China hopes the trip will ease those strains ahead of a G20 leaders summit in South Korea next week which will focus on global economic imbalances.
In turn, Sarkozy's government, which takes up the G20 baton after the Seoul summit, wants to build common ground for its ambitious agenda of reforming the global monetary system, while avoiding alienating China by harping on about the yuan.
"Under the current international situation that is undergoing profound and complicated changes, China and France share broad common interests and huge potential for cooperation," Hu said in a written statement on his arrival.
Paris has said its G20 agenda of diversifying global currency reserves away from the dollar and stabilising volatile commodity markets hinges on the support of the world's No. 2 economy.
Sarkozy and his wife, former model Carla Bruni, received Hu with full military honours at Paris's Orly airport. Hu's cavalcade, escorded by a formation of motorcycle escorts and the Republican guard on horseback, then swept down the historic Champs Elysees en route to the exclusive George V hotel.
"China should not be seen as a risk but an opportunity," Sarkozy said ahead of Hu's arrival.
"It's not by reproaching people for things that you make progress.... We're going to sign very important contracts and start very important talks on the eve of France's G20 presidency."
Ahead of a formal state dinner, Sarkozy and Hu presided over the signing of four contracts with EADS subsidiary Airbus, including with Air China, China Eastern and China Southern, and a deal with Total for a petrochemical plant. French officials billed it as the biggest corporate investment signing ceremony by China with a European leader.
Billions in contracts
The trip caps a rehabilitation of Sino-French ties since Sarkozy outraged Beijing in 2008 by meeting the exiled Dalai Lama, prompting some Chinese citizens to boycott French goods.
France, one of the first Western nations to open ties with Communist China in 1964, has carefully avoided antagonising Beijing ahead of the visit, scarcely reacting to last month's award of the Nobel Peace Prize to dissident Liu Xiaobo.
"We have the feeling the objective of this visit is to sell Airbus planes and nuclear reactors to China, which is good, but it is a detriment to human rights," said Jean-Francois Julliard, secretary-general of Reporters Without Borders, one of several groups that protested in Paris against Hu's arrival.
China Southern Airlines, the country's largest carrier by fleet size, said earlier on Thursday it would purchase 36 aircraft worth $3.78 billion from Airbus.
French telecom gear maker Alcatel-Lucent also announced 1.2 billion euros in deals with three Chinese phone companies, and insurer Axa was among other firms due to seal deals. Areva had declined to comment on reports it would sign a $3 billion uranium deal.
On Friday, Hu will travel to the Mediterranean resort of Nice, where afternoon talks are expected to centre on foreign affairs, including Iran's nuclear ambitious, the situation in Afghanistan and Pakistan, and the development of Africa, where resource-hungry Chinese companies are investing heavily.
On Saturday, Hu flies to Portugal where President Anibal Cavaco Silva, struggling to rein in his country's debt, will hope for a repeat of a Chinese performance in Greece that boosted the ailing Greek economy with promises of investment and debt purchases.