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U.S., China to Open Negotiations on Investment Treaty - Bloomberg.com
U.S. China Strategic Economic Dialogue (official website)
China draws lessons from U.S. financial turbulence
The U.S. and China agreed to start negotiations for an investment treaty that would guarantee access for the nations' companies to buy assets in the other country, two American government officials said.
The treaty will take at least a year to complete, the officials told reporters on a conference call today, on condition of anonymity. The accord would give companies from both countries the right to seek international arbitration if they face unfair discrimination, they said.
China would be the largest country with which the U.S. signed an investment treaty, and the talks come as American firms seek greater access to the world's fastest-growing major economy. Today's deal is the product of the fourth round of the semiannual Strategic Economic Dialogue discussions started by Treasury Secretary Henry Paulson in 2006.
An investment treaty ``would give us some traction'' to open China's markets to U.S. companies, said John Frisbie, president of the U.S.-China Business Council.
Paulson and Chinese Vice Premier Wang Qishan are leading the SED talks in Annapolis, Maryland, which conclude today. U.S. business groups representing companies such as Citigroup Inc. have pushed China to allow a greater role for overseas enterprises.
The two governments must now negotiate which industries would be covered or exempted from the accord, the officials said. Nothing in the final agreement would limit the ability of the U.S. to review investments for national security risk, they said.
It would be up to the next U.S. administration to decide if they will continue with the negotiations...
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American banks have sought a deal for China to raise its 25 percent ceiling on foreign ownership of domestic banks. Paulson, a former chief executive officer of Goldman Sachs Group Inc. who visited China more than 70 times, so far hasn't been able to secure such an agreement through his SED talks.
[..]
In the first day of this round of talks yesterday, the discussions ranged from the environment and intellectual- property rights to the environment and managing economic cycles.
The two countries today will also sign a 10-year plan to cooperate on energy and the environment. The accord will focus on air, water, clean energy, transportation, and conservation of forests and wetlands, Environmental Protection Agency Administrator Stephen Johnson told reporters yesterday.
People's Bank of China Governor Zhou Xiaochuan told reporters today that his top priority is keeping the country's inflation rate from rising above a 12-year high.
``Our main job is still preventing the economy from becoming overheated,'' Zhou said in Annapolis. ``Tackling inflation remains the most important task.''
The treaty will take at least a year to complete, the officials told reporters on a conference call today, on condition of anonymity. The accord would give companies from both countries the right to seek international arbitration if they face unfair discrimination, they said.
China would be the largest country with which the U.S. signed an investment treaty, and the talks come as American firms seek greater access to the world's fastest-growing major economy. Today's deal is the product of the fourth round of the semiannual Strategic Economic Dialogue discussions started by Treasury Secretary Henry Paulson in 2006.
An investment treaty ``would give us some traction'' to open China's markets to U.S. companies, said John Frisbie, president of the U.S.-China Business Council.
Paulson and Chinese Vice Premier Wang Qishan are leading the SED talks in Annapolis, Maryland, which conclude today. U.S. business groups representing companies such as Citigroup Inc. have pushed China to allow a greater role for overseas enterprises.
The two governments must now negotiate which industries would be covered or exempted from the accord, the officials said. Nothing in the final agreement would limit the ability of the U.S. to review investments for national security risk, they said.
It would be up to the next U.S. administration to decide if they will continue with the negotiations...
[..]
American banks have sought a deal for China to raise its 25 percent ceiling on foreign ownership of domestic banks. Paulson, a former chief executive officer of Goldman Sachs Group Inc. who visited China more than 70 times, so far hasn't been able to secure such an agreement through his SED talks.
[..]
In the first day of this round of talks yesterday, the discussions ranged from the environment and intellectual- property rights to the environment and managing economic cycles.
The two countries today will also sign a 10-year plan to cooperate on energy and the environment. The accord will focus on air, water, clean energy, transportation, and conservation of forests and wetlands, Environmental Protection Agency Administrator Stephen Johnson told reporters yesterday.
People's Bank of China Governor Zhou Xiaochuan told reporters today that his top priority is keeping the country's inflation rate from rising above a 12-year high.
``Our main job is still preventing the economy from becoming overheated,'' Zhou said in Annapolis. ``Tackling inflation remains the most important task.''
Opening Statement by Secretary Henry M. Paulson, Jr.
at the Fourth Meeting of the U.S. – China Strategic Economic Dialogue - June 17, 2008
at the Fourth Meeting of the U.S. – China Strategic Economic Dialogue - June 17, 2008
The U.S. – China economic relationship is complex, broad and important to both our countries and to the world economy. The U.S.-China relationship has become central to each nation's interest and to maintaining a stable, secure and prosperous global economic system.
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At this meeting, we will build on previous progress, including landmark agreements on food, feed and product safety announced at our December SED meeting in Beijing. In December, we announced that the U.S. will provide technical assistance for China to develop and implement a nationwide SO2 emission trading program in the power sector...
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At this week's meeting, we will have a robust discussion of our economic relationship as we envision a future of sustainable economic growth. We will look at managing financial and macroeconomic cycles. Both the United States and the Chinese economies face current challenges, including higher energy and food prices. The United States is working through a housing market correction and re-pricing of risk in credit markets. China is grappling with rising inflation and growing internal and external macroeconomic imbalances.
The state of our economies affects our people, and affects world prosperity. As we manage through the current challenges, we must also focus on the long-term fundamentals that underlie sustainable growth in both our nations. During the course of these two days, I will highlight how free trade, competition and open economies are essential. Openness and trade create jobs and opportunities for people to rise out of poverty, and are necessary for economic growth and stability – in both China and in the United States.
And we will discuss the steps needed to ensure that our countries and the world economy remain open to trade. We will discuss the best way to promote and protect bilateral investment and to counter protectionist pressures. We will discuss how open and competitive financial markets, including currency markets, are more resilient in times of turmoil and more vibrant and efficient in supporting balanced economic growth.
[..]
We will also discuss the structural imbalances and the saving rate challenge facing each of our economies. In the United States our saving rate is too low. In China it is too high. In order to effectively deal with this issue, we must address how to adequately provide for our aging populations, including the role of private and public insurance and financing for social services such as health care and retirement.
Finally, we will also advance joint opportunities for cooperation on energy security and the environment. As the two largest net importers of oil, China and the United States face similar challenges as demand for energy increases, and the global production capacity has remained relatively flat for the past ten years.
We have a strong and shared interest in avoiding supply disruptions, increasing energy efficiency, promoting the efficiency and transparency of the global energy markets to the benefit of all oil importing nations, and expanding the availability and use of alternative energy sources. We will continue working together on joint efforts already in place, such as a five-year commitment to promote alternative fuel technologies for vehicles, and explore new possibilities.
[..]
At this week's meeting, we will have a robust discussion of our economic relationship as we envision a future of sustainable economic growth. We will look at managing financial and macroeconomic cycles. Both the United States and the Chinese economies face current challenges, including higher energy and food prices. The United States is working through a housing market correction and re-pricing of risk in credit markets. China is grappling with rising inflation and growing internal and external macroeconomic imbalances.
The state of our economies affects our people, and affects world prosperity. As we manage through the current challenges, we must also focus on the long-term fundamentals that underlie sustainable growth in both our nations. During the course of these two days, I will highlight how free trade, competition and open economies are essential. Openness and trade create jobs and opportunities for people to rise out of poverty, and are necessary for economic growth and stability – in both China and in the United States.
And we will discuss the steps needed to ensure that our countries and the world economy remain open to trade. We will discuss the best way to promote and protect bilateral investment and to counter protectionist pressures. We will discuss how open and competitive financial markets, including currency markets, are more resilient in times of turmoil and more vibrant and efficient in supporting balanced economic growth.
[..]
We will also discuss the structural imbalances and the saving rate challenge facing each of our economies. In the United States our saving rate is too low. In China it is too high. In order to effectively deal with this issue, we must address how to adequately provide for our aging populations, including the role of private and public insurance and financing for social services such as health care and retirement.
Finally, we will also advance joint opportunities for cooperation on energy security and the environment. As the two largest net importers of oil, China and the United States face similar challenges as demand for energy increases, and the global production capacity has remained relatively flat for the past ten years.
We have a strong and shared interest in avoiding supply disruptions, increasing energy efficiency, promoting the efficiency and transparency of the global energy markets to the benefit of all oil importing nations, and expanding the availability and use of alternative energy sources. We will continue working together on joint efforts already in place, such as a five-year commitment to promote alternative fuel technologies for vehicles, and explore new possibilities.
China draws lessons from U.S. financial turbulence
"China is the world's largest developing country and the United States is the world's most advanced economy. China always hopes to draw lessons from the U.S. experience in macro economy management and market development. However, during this time of discussion, we are also interested in drawing lessons from the U.S. financial turbulence," Zhou Xiaochuan, governor of the People's Bank of China, told reporters on the sidelines of the ongoing 4th Sino-U.S. Strategic Economic Dialogue, or SED, in Annapolis, Md.