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China Daily Website

Fiscal cliff looms large over trade talks

Updated: 2012-12-19 02:49
By Chen Weihua in Washington and Li Jiabao, Li Xiaokun in Beijing ( China Daily)

China's non-financial outbound investment in the US registered $1.81 billion in 2011, up 38.5 percent year-on-year.

"In addition to Chinese investments in the US, China will also expect the US to take effective measures in export controls, trade cases against China and intellectual property protection," Shen said.

He Weiwen, co-director of the China-US-EU Study Center at the China Association of International Trade, said that the talks will help the US better understand China's signals on continuing reforms and opening-up, as well as welcoming US investment.

During a trip to southern Guangdong last week, Party chief Xi Jinping echoed calls made by late leader Deng Xiaoping on market reforms and strengthening the rule of law.

Huo Jianguo, president of the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, said that this year's talks will play a key role in ties. "Easing obstacles to Chinese investment in the US will be an important issue in this year's talks,'' Huo said.

"It will enhance trust and create a positive atmosphere for cooperation," Huo said.

"The key for Sino-US economic ties is long-term strategic trust."

Derek Scissors, a senior research fellow at the Heritage Foundation in Washington, told Reuters that "we're either going to get nothing, meaning just details, or we might get a change".

"I don't think we should be expecting sweeping changes, but I do think we will see tangible progress on some specific issues," said John Frisbie, president of the US-China Business Council.

"China is definitely prioritizing its US relations and they are also discussing economic reforms back at home that could impact some of the issues that matter to US companies."

The meeting has become a central forum for the management of the US-China economic relationship. Along with the Strategic and Economic Dialogue, it is a valuable platform to discuss disputes, said Edward Alden, a senior fellow at the Council on Foreign Relations.

"The Obama administration has been working on a significant overhaul of its export restrictions on high-technology goods, and there are genuine prospects for progress in the second term," he said.

Alden believes the lack of protection for intellectual property rights in China continues to be a major irritant in relations. "The big problem is that the tools for enforcement are inadequate," he said.

He said he will be particularly interested to see if there is any progress in discussion over a bilateral investment treaty between the US and China.

Karl Sauvant, a resident senior fellow at the Vale Columbia Center on Sustainable International Investment at Columbia University, echoed Alden's views.

He said the meeting is an excellent opportunity to reconfirm on both sides that the negotiation for a trade treaty between China and the US is in the interests of both sides.

"Naturally, the negotiations will present a number of challenges that need to be met, and some issues may even require decisions on the political level, but I think it is certainly worthwhile to press ahead with them," said Sauvant, editor of the book Is the US Ready for FDI from China?

Contact the writers at chenweihua@chinadaily.com.cn.

Reuters contributed to this story.

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