Treasury Secretary Timothy Geithner said he did not agree with current opinion that the sovereign debt crisis had become the biggest threat to the world economy, China's Xinhua news agency reported on Saturday.

You see some of the challenges in Europe now. But I think we are in a much stronger position to manage those challenges, he told Xinhua in an interview.

Geithner said the global economy was in a much stronger position to withstand coming pressure from Europe. He also said the U.S. dollar had been rising because there was quite a lot of confidence in the U.S. economy around the world.

Geithner was speaking ahead of high-level China-U.S. talks in Beijing next week, where both countries will look for ways to balance their $400 billion trade ties on a more permanent basis, steering clear of an open clash about the yuan's peg to the dollar.

China and the United States are doing what we need to do to help contribute to a broader global economic recovery, Geithner said.

The U.S. administration is going to tackle the deficit situation very seriously, Geithner told Xinhua. As he tries to reinvigorate the U.S. economy, President Barack Obama has set a goal of doubling exports in five years, which can be met only with a big increase in sales to China.

Geithner said there had been a dramatic transformation in both economies which contributed to a more balanced global recovery. He added that the growth in China's domestic demand was encouraging as was the substantial fall in the country's current account trade surplus.

(Reporting by Farah Master; Editing by Jeremy Laurence)