Asia Pacific leaders struggled to agree a final statement on Sunday as Washington and Beijing debated the wording on market-oriented exchange rates and trade protectionism, an APEC delegation official said.
The official, who declined to be identified, told Reuters the statement had been delayed because of discussions between the two global giants on the sidelines of an Asia Pacific Economic Cooperation (APEC) forum meeting in Singapore.
Strains over trade will be high on the agenda when U.S. President Barack Obama visits China this week, after Washington recently slapped duties on Chinese-made tires and followed up with action on oil well pipes.
An earlier draft statement to be issued by APEC leaders would have pledged its 21 members to actively reject protectionist measures and maintain market-oriented exchange rates that reflect underlying economic fundamentals.
That earlier statement had been agreed at a meeting of APEC finance ministers on Thursday, including China, although it made no reference to the Chinese yuan currency. Chinese President Hu Jintao has been under pressure to let the yuan appreciate, but in a speech at an APEC business summit on Friday he ignored the issue and focused instead on what he called unreasonable trade restrictions on developing countries.
One of the major themes when Obama visits China will be its yuan, which has effectively been pegged against the dollar since mid-2008 to cushion its economy from the downturn.
Washington says an undervalued yuan is contributing to imbalances between the United States and the world's third-biggest economy.
China's central bank said last week it will consider major currencies in guiding the yuan, suggesting a departure from the peg.
APEC leaders are still expected to pledge to keep stimulus policies in place to stop the world from sliding back into recession.
Obama arrived in Singapore late on Saturday, missing most of the day's formal talks and speeches where several leaders suggested the world's largest economy was hampering free trade through policies such as Buy America campaigns.
Speaking in Tokyo before he arrived, Obama called for a new strategy to rebalance global growth, referring to the excessive consumption in the United States and the over-reliance on exports from some countries that many blame for the economic crisis.
CLIMATE TALKS IN FOCUS
APEC is the last major gathering of global decision-makers before a U.N. climate summit in Copenhagen in three weeks meant to ramp up efforts to fight climate change.
Those negotiations have largely stalled, but a U.S. official said Obama had backed a two-step plan by the Danish prime minister to aim for an operational agreement and to leave legally binding details until later.
The APEC draft earlier dropped a reference to emissions reductions of 50 percent by 2050, and pledged instead to substantially cut carbon pollution by 2050.
The statement said job creation would be at the heart of economic policy, a hot topic as unemployment has risen across the industrialized world and put pressure on governments to act.
Looking beyond supporting the recovery, we recognize the necessity to develop a new growth paradigm for the changed post-crisis landscape, and an expanded trade agenda for enhanced regional economic integration, the draft APEC statement says.
(Editing by John Chalmers)