US preps for 8th high-level S&ED

China Daily (Canada) - - ACROSS AMERICAS - By CHEN WEIHUA in Wash­ing­ton chen­wei­hua@chi­nadai­lyusa.com

We were able to have a ro­bust ex­change of ideas and make con­crete progress.”

China and the United States will kick off their an­nual high-level bi­lat­eral meet­ing early next month in Bei­jing to ad­dress a set of se­ri­ous bi­lat­eral eco­nomic and se­cu­rity is­sues.

The Eighth Strate­gic and Eco­nomic Di­a­logue (S&ED) will be the last one to be held un­der the Obama ad­min­is­tra­tion.

Nathan Sheets, the US un­der­sec­re­tary of Trea­sury for in­ter­na­tional af­fairs, praised the last few years’ S&EDs for mak­ing progress in such ar­eas as pro­mot­ing the rule of law, strength­en­ing reg­u­la­tory trans­parency and en­cour­ag­ing eco­nomic re­forms.

Sheets said he was es­pe­cially happy with last year’s S&ED, which took place a few months be­fore Pres­i­dent Xi Jin­ping’s state visit to the US in Septem­ber. “We were able to have a ro­bust ex­change of ideas and make con­crete progress on an am­bi­tious set of eco­nomic out­comes,” he told a group at the Brook­ings In­sti­tu­tion on Tues­day.

Sheets said the US will en­gage China on a num­ber of key is­sues this year, in­clud­ing global ex­cess in­dus­trial ca­pac­ity, in­vest­ment lib­er­al­iza­tion and macroe­co­nomic re­bal­anc­ing. He gave a long list of US con­cerns, from mar­ket ac­cess to a level play­ing field and ex­change rates.

Chi­nese of­fi­cials have not pub­licly talked about their agenda for this year’s S&ED. But China has long pressed the US to lift its out­dated re­stric­tions on high-tech ex­ports to China, to make the CFIUS (Com­mit­tee on For­eign In­vest­ment in the United States) re­view process of Chi­nese for­eign di­rect in­vest­ment in the US fairer and more trans­par­ent.

Sheets said the two au­thor­i­ties were dis­cussing mech­a­nisms to fa­cil­i­tate RMB trad­ing and clear­ing in the US, some­thing he de­scribed as a “pri­or­ity high­lighted in Pres­i­dent Obama’s meet­ing with Pres­i­dent Xi last Septem­ber”. He said the US is wait­ing for a new neg­a­tive list from China in ne­go­ti­at­ing a high-stan­dard Bi­lat­eral In­vest­ment Treaty (BIT).

Hope for a BIT to be con­cluded un­der the Obama ad­min­is­tra­tion has been damp­ened by the 2016 US cam­paign. The Obama ad­min­is­tra­tion is still try­ing to get a di­vided Congress to rat­ify the Trans-Pa­cific Part­ner­ship (TPP). Anti-trade rhetoric has been run­ning strong on the pres­i­den­tial cam­paign trail.

Sheets noted that China has be­gun em­bark­ing on a re­form agenda to­ward more sus­tain­able and bal­anced growth by ad­dress­ing is­sues such as in­dus­trial over­ca­pac­ity, open­ing up the service sec­tor, strength­en­ing the social safety net, im­ple­ment­ing land re­form and pro­mot­ing a more mar­ket-based fi­nan­cial sys­tem.

“Con­struc­tive en­gage­ment with China is im­por­tant for the United States and for the mil­lions of Amer­i­can jobs which de­pend on a strong, sta­ble and grow­ing global econ­omy,” he said.

State Coun­cilor Yang Jiechi and Vice-Premier Wang Yang will head the Chi­nese del­e­ga­tion to this year’s S&ED. The US team will be led by Sec­re­tary of State John Kerry and Trea­sury Sec­re­tary Jack Lew.

Kerry will also join Vice-Premier Liu Yan­dong for the Sev­enth Chi­naUS Con­sul­ta­tion on Peo­ple-to-Peo­ple Ex­change (CPE).

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