Spy plane dispute resolved - China

A top Chinese official has said he believes his country and the United States have resolved their dispute over the downed US spy plane, and agreed to hold China’s highest level meeting with the Bush administration since the crisis began.

China’s finance minister Xiang Huaicheng and US Treasury Secretary Paul O’Neill were meeting yesterday on the sidelines of an annual meeting of the Asian Development Bank in Honolulu, Hawaii, primarily to discuss economic issues.

Xiang told reporters ‘‘there has been satisfactory resolution to the troubles’’ between Beijing and Washington and that it would be exaggerated to say their relations had been strained over the spy plane any worse than they had been in the past.

Xiang gave no indication any new agreements had been reached on the issue but that the conflict would not remain an obstacle to US-Chinese relations.

‘‘Secretary O’Neill (and I) share a consensus that we need to talk’’ to resolve any outstanding issues, Xiang said. ‘‘I trust Secretary O’Neill will ask me whatever questions he has and tell me whatever he wishes to tell.’’

Michele Davis, O’Neill’s spokeswoman, said the meeting would allow the two officials to get to know one another and discuss their respective economies.

‘‘There is no intention of raising the spy plane or other such issues,’’ she said.

A senior US Treasury official said that O’Neill had no plan to raise the issue, but if the Chinese do ‘‘you play the unexpected from your instincts’’.

It would be the highest-level meeting of Chinese and US officials since China’s deputy prime minister Qian Qichen visited the White House in March.

Relations between the two countries soured after the collision on April 1 between a US Navy EP-3E surveillance plane and a Chinese fighter jet over the South China Sea.

The Chinese fighter crashed, killing the pilot, and the US plane made an emergency landing on China’s Hainan Island.

China released the 24 US crewmen after 11 days in captivity and has since allowed US officials to inspect the spy plane.

They determined it could be repaired and flown off the island, but China has refused to allow this, saying that would outrage the Chinese public.

US forces also have resumed surveillance flights off China’s coast, angering Beijing.

The collision set a sour tone to relations early in the Bush administration, further straining ties already hurt by differences over human rights and arms sales to Taiwan.