China and the US are likely to make progress on Bilateral Investment Treaty (BIT) talks during their annual high-profile dialogue, a Chinese vice finance minister said on Monday.
"Both sides will reach new agreements in BIT talks. In other words, the two countries will launch the negative list-based negotiations at an early date," Vice Finance Minister Zhu Guangyao said at a press briefing on Monday.
The briefing came two days ahead of the sixth round of China-US Strategic and Economic Dialogue (S&ED), which will take place in Beijing from Wednesday to Thursday.
At last year's S&ED, the two countries made strides in talks over BIT that will deepen an economic relationship in which two-way trade already exceeds 520 billion US dollars.
China wants the US to narrow the national security reviews on Chinese investment, while the US side would like to see China keep its "negative list," which details sectors barring US investment, as short as possible.
"China believes that BIT negotiations on the basis of pre-establishment national treatment with a negative list approach are in accord with the direction of China's economic restructuring," Zhu said.
Mike Froman, the US trade representative, said Washington hopes to use the upcoming annual S&ED to break the standoff over updating the 1996 Information Technology Agreement which eliminates tariffs on IT products covered by the agreement among WTO members, Financial Times reported on Sunday.
The standoff is centered on China's push to exempt about 60 new product categories including medical devices and next-generation silicon chips from the ITA, the report said.
China's Ministry of Commerce was not immediately available for comment on the matter on Monday.
"The remarks of the American trade representative are intended to exert pressure on China in order to open the market wider for US competitive IT products as it is eager to revive its manufacturing sector with high technologies," Bai Ming, a researcher at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times on Monday.
Such a demand for an open market is reasonable only on an equal basis, Bai said citing the US restrictions on the entry of high-tech Chinese companies.
Yuan, monetary policy on agenda
China and the US will discuss the yuan's value as well as the impact of US monetary policy at S&ED this week, Chinese Vice Finance Minister Zhu Guangyao said on Monday.
"Both sides will conduct candid and comprehensive policy dialogues on the RMB (yuan) issue and issues concerning China's domestic financial reforms," Zhu told reporters at a briefing .
Zhu said China had urged Washington to pay attention to the possible "spillover effect" of changes in its monetary policy on the world economy, as the Federal Reserve unwinds its quantitative easing.
"We hope the monetary policy of the US, as the largest developed country and main reserve currency issuer, would be responsible," Zhu said.
