China also made commitments to streamline the sale approval of American medical devices; to adjust capital requirements that American telecommunications companies see as a major barrier to setting up Chinese operations; and to make sure new rules do not discriminate against US express delivery firms.

Wu reiterated that the United States could also help itself by lifting security restrictions on exports of high technology to China. At the JCCT talks, Washington agreed to explore that issue through top-level talks.

The large purchases in the United States could not fully eradicate the trade deficit, but they delivered a very important message to the US Congress, the public and the media, said Zhou Shijian, a researcher with the Institute of American Studies under the Chinese Academy of Social Sciences. "It shows the sincerity and goodwill of the Chinese Government and enterprises to redress the bilateral trade imbalance," Zhou said.

US-China Business Council President John Frisbie welcomed the outcome of the JCCT talks.

"A comprehensive, step-by-step approach that includes carrots, not only sticks, to develop mutually beneficial trade ties and resolve differences is the best way for the United States and China to make measurable, lasting progress in the commercial relationship," he said.

The US Commerce Department announced yesterday that the bilateral trade gap with China shrank 22.7 per cent in February as the country's deficit narrowed 4.1 per cent to US$65.7 billion.

The trade deficit with China narrowed significantly to US$13.8 billion the lowest level since March 2005 reflecting a 16.2 per cent drop in imports and a 17 per cent rise in exports, it said.