US-China trade talks a 'turning point' in relations

Beijing ready to advance BIT talks with Washington, says diplomat

The Bilateral Investment Treaty talks between China and the United States can be an "inflection point" in economic cooperation, a high-profile diplomat said on Wednesday.

Beijing is ready to work with Washington to advance the BIT negotiations, and it welcomes foreign companies to "share the dividends" of China's new round of reform and development, said Xie Feng, director-general of the Foreign Ministry's department of North American and Oceanian affairs.

"China also hopes the US will take measures to provide a fair and sound investment environment for Chinese companies and facilitate healthy development of two-way investment," Xie said during a seminar co-sponsored by Fudan University and the US-based Brookings Institution.

The 10th round of talks is being held this week on the BIT, which would boost two-way direct investment. The talks were put on the fast track after a meeting between President Xi Jinping and US President Barack Obama.

Xie said the talks were being conducted on the basis of pre-establishment national treatment, accompanied by a "negative list" approach.

China is taking concrete steps to facilitate the talks, Xie said. The upcoming Third Plenum of the 18th Central Committee of the Communist Party of China will draw up a master plan for deepening reform, including a time frame and road map.

He also referred to the pilot free trade zone in Shanghai, which is intended to broaden investment access and the service sector, with trade facilitation measures introduced to boost both imports and exports.

He estimated that over the next five years, China's merchandise imports will exceed $10 trillion and its overseas investment will reach $500 billion. Outbound trips by Chinese people will reach 400 million.

Another area of cooperation is in the energy sector, Xie noted. He called for an early start of liquefied natural gas exports from the US to China and more collaboration on shale gas development.

Xie also urged the loosening of US high-technology export controls, which he said had long undermined the otherwise swift growth in bilateral trade.

The BIT is probably the most important trade negotiation since the WTO talks, as it complements both the Trans-Pacific Partnership Agreement and the Transatlantic Trade and Investment Partnership.

These are two parallel free trade pacts in which the US is engaged across the Asia-Pacific region and Europe, said Richard Bush, director of the Center for Northeast Asian Policy Studies at the Brookings Institution.

"I think the BIT opens new doors for a deeper and richer economic relationship, and it would actually be a good steppingstone to include China in future TPP talks," he said.

Kenneth Jarrett, president of the American Chamber of Commerce in Shanghai, said the BIT will benefit US businesses in China by addressing market access issues.