China, US 'pragmatic about pact'

The discussions restarted in July 2013, when China made an important concession on the negotiation basis. Every sector will come up for discussion unless restricted by a "negative list", and foreign enterprises will be given "pre-establishment national treatment", or treated the same as domestic companies.

The 10th round of negotiations, held in Washington, DC, in October, showed the discussions entering a substantive stage.

China is revising its laws on foreign direct investment to build a stable, transparent and predictable environment and to raise foreign investors' confidence in the world's second-largest economy, Wang Shouwen, China's assistant minister of commerce, said on Tuesday.

The government set up the China (Shanghai) Pilot Free Trade Zone last year to streamline administrative procedures for foreign direct investment and to try out the approach of a negative list and equal treatment for foreign enterprises.

It will unify laws and regulations on local and foreign investments and let the market play a decisive role in the allocation of resources.

It also will step up the establishment of investment pacts with other countries and reform the approval mechanism for foreign investment, according to a report from the Third Plenary Session of the 18th Central Committee of the Communist Party.

"The China-US bilateral investment pact carries more significance than China's accession into the World Trade Organization," said Wang Xinkui of the Shanghai WTO Center.

"China is now the world's biggest goods trader and second-largest economy. The bilateral pact between the world's top two economies represents the orientation of global investment rules and covers issues such as intellectual property rights, labor and environmental protection. It will also shed light on the future investment pacts with other economies."

China's direct investment in the US has increased rapidly in recent years, surging 232.2 percent year-on-year in the January-November period of 2013, said the ministry.