Caspar W. Weinberger, chairman of Forbes, yesterday spoke highly of China's achievements during the past two decades.

"It's difficult to give any advice on China's economic policies because it is doing so well," said Weinberger in discussion with Yang Lan, chairperson of Sun Media Group, on the third day of the Forbes Global CEO Conference in Shanghai.

"Deng Xiaoping was very eager to introduce China's advantages to the world," recalled Weinberger, who once served in the United States in Nixon's administration as chairman of the Federal Trade Commission in the early 1970s and was later named director of the Office of Management and Budget in 1972.

For much of the past two decades, China achieved double-digit economic growth without major inflation.

Such achievements are astonishing, said Weinberger, who made his latest visit to the Chinese mainland more than a decade ago.

"No one could really foresee such great entrepreneurial activities being held in China when Nixon came over in the early 1970s," he said.

"If there is one piece of advice I should suggest, it will be an encouragement of further investment," Weinberger added.

Talking about US policies towards China, the former US secretary of defence would not elaborate or make any prediction as the presidential election is around the corner.

But he emphasized that the US government should stick to the policy of engagement with China.

"I don't perceive any major difference (on US policies towards China) between President Nixon and the current Bush administration," said Weinberger.

US presidents can never ignore such a big nation with a 1.3 billion population, and they all recognize the great potential in China's economy, according to Weinberger.

But he also pointed out that strategic competition between the two countries is inevitable.

"Such strategic competition between two large economies will continue to grow, and there's nothing wrong with it," he added.

China has grown into a stronger economy as China produces goods that people around the world want to buy, said Weinberger.

When addressing the issue of revaluation of renminbi, he argued that revaluation or manipulation of currencies will not work for very long. "I don't think it's necessary and I doubt it's effective."

He noted what governments should do is to concentrate on growth of their own economies.

Improper manipulation of a currency will instead reduce certain incentives to achieve sustainable development, he cautioned.

Weinberger noted the US should not blame China or any other countries for its current situation of high unemployment and poor economic performance.

"Just like a few years ago, somebody in the US suggested that Americans should not buy Japanese automobiles because they are made too cheaply and that hurt America's manufacturing sector."

Now some Americans are seriously suggesting not to buy products from China because more American jobs will be lost.

"That's ridiculous," he said.

The prime consideration should be whether or not American customers can get what they want to buy at a proper price and assured quality.

Born in 1917, Weinberger served under three US cabinets headed by President Nixon, Ford and Reagan.

He was nominated by President Reagan to be secretary of defence in 1980 and served in that position until his resignation on November 23, 1987.

Weinberger became the second chairman of Forbes in 1993. Prior to that, he had served as publisher of the magazine since 1989.

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