China and the United States made commitment this week to exchange improved negative list offers in early September and speed up talks on a bilateral investment treaty (BIT), giving experts a sense of optimism that the world's two largest economies could wrap up BIT negotiations under U.S. President Barack Obama's administration.
IMPORTANT MILESTONE
The two sides discussed their initial offers of negative lists, which outline sectors closed to foreign investment, and the next step in BIT negotiations during the seventh round of China-U.S. Strategic and Economic Dialogue (S&ED), China's Vice Finance Minister Zhu Guangyao said Wednesday here at a closing press briefing of the two-day high-level dialogue.
The two sides reaffirmed the treaty talks as "a top priority" in bilateral economic relations and recognized that the exchange of negative list offers in the latest round of talks is "an important milestone," according to a joint economic track fact sheet of this year's S&ED.
While China's initial negative list offer "may be longer than the U.S. wants," the negative list itself is already "a huge progress," Adam Posen, president of Peterson Institute for International Economics (PIIE), told Xinhua in a recent interview.
Zhang Xiangchen, China's deputy international trade representative and assistant minister of commerce, said Tuesday at a press briefing that "the negative list issue is more difficult for China," as it "represents a new challenge" and will " fundamentally change foreign investment administration regime in China."
Zhang said China has decided to "follow international practices with the negative list approach" in investment treaty talks with the United States because more than 70 countries in the world have already adopted this approach in foreign investment management.
China has "established an inter-ministerial mechanism" in the state council and "reviewed tens of thousands of laws, regulations and rules," which governed foreign investment in China with the positive list approach, to develop its negative list for investment treaty talks, the Chinese official added.
The negative list approach means all sectors are open to foreign investment except those specifically listed, while the positive list approach means that only listed sectors are approved for foreign investment. The former is generally viewed as a more liberal approach to foreign investment.
The investment treaty talks began in 2008 as China and the United States sought to increase mutual investment, which only accounted for a tiny share of their respective overseas investment.
