Senior Chinese and US officials have also agreed to speed up negotiations on a bilateral investment treaty during the dialogue.

Chinese Vice Premier Wang Yang told a news briefing on Tuesday that the two countries will exchange new "negative list" offers, which outline sectors closed to foreign investment, in mid-June.

"If it's possible, it's probably a very very good offer," Dollar said. However, he noted that "this is a very difficult process -- that will likely go into the next (US) administration."

The last time the two sides exchanged such lists was in early September last year, days ahead of Chinese President Xi Jinping's state visit to the United States.

Xi on Monday urged both countries to strengthen coordination on their macroeconomic policies and reach a reciprocal bilateral investment treaty as early as possible.

Dollar said the two sides "are cooperating well" on some strategic issues, though disagreements remain over the South China Sea issue.

He stressed that "the two sides have an enormous interest in not having conflict" over the South China Sea, and that he believed the two sides should be able to avoid conflict.

Chinese and US militaries have "quite a bit of cooperation" in various dimensions, he said, noting that the growing communication "reduces the risk of miscalculation."

Chinese State Councilor Yang Jiechi on Tuesday called on the United States to play a constructive role in safeguarding peace and stability in the South China Sea.

"It is important to protect regional peace and stability," Yang told a press briefing, stressing that territorial and maritime disputes in the South China Sea should be settled through peaceful negotiations and consultations by the countries concerned.