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WASHINGTON - US Treasury Secretary Henry Paulson will visit China's largest lake next week on a trip that will highlight global environmental challenges. Treasury Secretary Henry Paulson speaks during an interview with Reuters in Washington July 2, 2007. [AP]Paulson will also hold talks in Beijing with President Hu Jintao that will focus on the Strategic Economic Dialogue, high-level discussions launched last year in an effort to deal with economic tensions between the US and China. "This trip is part of an ongoing process to strengthen our strategic economic relationship - to address long-term issues such as working with China to rebalance its growth and increase the flexibility of its currency and also to address short-term issues as they arise," Paulson said Tuesday in announcing the trip. Paulson will begin the trip with a visit July 30 to Qinghai Lake, the largest lake in the country and an example of some of the environmental challenges facing China as it struggles to deal with pollution. "The only way to make progress on climate change is to engage all the large economies, developed and developing, to work toward embracing cleaner technology and reducing emissions," Paulson said. "What's happening with the environment in the middle of China not only affects the local climate and economy but also the global climate and economy." Paulson will meet on July 31 in Beijing with Hu and Vice Premier Wu Yi, who is leading the Chinese side in the strategic dialogue talks. The administration is coming under pressure from Congress to show results from these discussions, particularly in the area of currency values. American manufacturers contend that the yuan is undervalued by as much as 40 percent, which makes Chinese products cheaper for US consumers but makes it more difficult for US products to be sold in China. The first strategic dialogue session was held in Beijing last December with a follow-up meeting in Washington in May. The two countries have pledged to meet twice a year with the next session to take place in China later this year. An exact date has not yet been announced. The Treasury Department said in a statement announcing the trip that Paulson in his meetings with Chinese leaders would raise issues of concern to Congress as well as follow up on issues that were identified as priority items at the May meeting of the strategic dialogue. US lawmakers have grown increasingly unhappy as America's trade deficit with China has soared, hitting 3 billion last year, the largest ever recorded with a single country and one-third of the US total deficit with the rest of the world. Various bills have been introduced that would require the administration to take a harder line on the currency issue including pursuing economic sanctions if China does not move more quickly to allow its currency to rise in value against the dollar. China has reiterated that it does not manipulate its currency and the currency reforms are moving as quickly as the developing economy and financial system will allow.

Chinese once associated tattoos with criminals and misfits; today, they are redrawing the lines around how they think about ink. The growth of China's emerging tattoo culture was evident by the more than 2,000 visitors who attended Saturday's opening of the country's largest tattoo gathering, Tattoo Show Convention 2007, which ends today. Attracting more than 100 artists from all over China and the world, the show at the Sanshang Art Beijing Gallery was intended as a platform for interaction among Chinese from around the country, their international counterparts and the public. "We hope to give them a platform so they can learn from each other," said Xiao Long, who founded the non-profit convention in 2001. Tattooed Chinese photographed each other's ink, while artists displayed their works and even tattooed visitors at their booths. German artist Frank Kassebaum, of Bremen, said he was surprised by what he saw. "Before I came here, I thought that China wasn't so far along in its tattoo culture, but from what I see here, I really think that, in 10 years, they'll be better than the United States, Japan and Europe," he said. "The boom in Japan was 10 years ago; now, the boom is here." Co-organizer Chris Wroblewski, of New York City, said one of the major purposes of the show was to educate Chinese to be prudent about getting tattoos. He said that during China's "Tattoo Renaissance", many shops were opening up, offering "mass production stuff" drawn by "artists who learned in two weeks and are just plowing needles into skin". He explained that as tattooing developed in China, there would be a proliferation of both "high art and low art". YZTattoo parlor model Qi Xuan, 26, said she believes the convention showcases the progress made by China's "high-art" tattoo artists. "In recent years, Chinese tattoo artists have become more skillful in design, technique and use of color," the Beijinger said. "Now, you can see more tattoo artists who can make very international designs. Because artists come to this show from every part of the country, we know what they are doing outside of Beijing." Wroblewski said that because Chinese tattooing was "still in its infancy", it often emulates the West. "But the Chinese are beginning to pick up on their roots and will start demanding more of their own culture." Student Wang Hao, of Beijing, said he came to the show because he was considering getting a tattoo and wanted to learn more about them. "I'd like to get a traditional Chinese tattoo, because I love China," the 22-year-old said.

The central finance department will continue increasing its support to the country's rural areas, sources from a meeting of the political bureau of the Communist Party of China Central Committee said.The Xinhua News Agency on Saturday cited a political bureau meeting as saying that the country should further muster up strength to solve the problem of its poor agricultural infrastructure and the sluggish development of rural areas by "increasing input in agricultural sectors and rural areas".The report, which comes just days before the Party's 17th National Congress on October 15, the most important political gathering in China which will set guidance for future development, suggests Party leaders are concerned about the urgency needed to improve farmers' lives, analysts said.An anonymous official from the Ministry of Finance said that the central government has made financial support for rural areas a major priority .The country has rolled out a series of preferential policies to boost the development of its vast countryside, home to its more than 700 million rural people, including agricultural taxation reform to alleviate farmers' burden and direct subsidies to ensure gains from growing crops.The State has also exempted farmers from some taxes such as those in the slaughtering and animal husban-dry industry.Statistics from the ministry shows that the central coffers plan to invest 391.7 billion yuan ( billion) in the development of its rural areas this year, an annual increase of 15.3 percent.To further encourage farmers to grow crops, billions of yuan have been allotted for agricultural subsidies for grain prices, seeds, and cultivation facilities.About 125 billion yuan of tax has been waived since the removal of a series of agricultural taxes in recent years, the official said.The results of these preferential policies were obvious, the official said, with statistics showing a fourth consecutive bumper grain harvest this summer.

Chinese officials said water quality was improving in the country's third-largest lake, choked by a polluted slick of algae, but experts warned that tap water in the area was still not safe, state media reported on Saturday. Taihu Lake, in the southern province of Jiangsu, has been struck by a foul-smelling canopy of algae that left tap water undrinkable for more than 2.3 million residents of nearby Wuxi and prompted a run on bottled water at local supermarkets. Residents said the government was telling them it was safe to drink boiled water, but complained that it still had an unappealing green film on top. Environment experts said it was unlikely to be fit to drink. "Although quality of the water supply has improved significantly on Friday and now it is safe for washing hands or clothes, it still takes some time to become drinkable," the Zhang Xiaojian, an environment specialist at Tsinghua University in Beijing said. Algae blooms can develop in water that is rich in nutrients, often because of run-off from heavy fertiliser use, industrial waste and untreated sewage. Officials have invoked emergency measures, diverting the Yangtze river and seeding clouds to provoke rainfall, to try to flush out the algae. Heavy rainfall is also expected in the area in the next few days. Residents of Wuxi said the algae, which they said smelt like rotten meat, was driving a roaring trade at McDonald's and KFC fast-food outlets in the city. "Here they fry food," said a company manager named Zhao as he queued at KFC. "I can't eat dumplings or noodles because they would be cooked in water and it's too expensive to use bottled water."