US, China making progress on investment treaty

Progress is being made on a U.S.-China bilateral investment treaty (BIT) that would expand trade between the world's two largest economies, a top State Department official said Monday. 

Catherine Novelli, under secretary of State for Economic Growth, Energy and the Environment, said ongoing talks to reach an agreement on a deal are moving forward between Washington and Beijing. 

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"They're going very well," Novelli told reporters on Monday. 

U.S. and Chinese officials met about two weeks ago on the agreement.

Next, China is expected to submit in March a list of sectors they will seek to exclude from the deal and won't be open to foreign investment — the so-called negative list. 

The United States has been pressing Beijing to keep the list as narrow as possible with the aim of wrapping up work on a deal before President Obama leaves office.

"The important thing is that each time we meet we are actually making progress, and we are moving forward and we are closing out more things," Novelli said. 

She said one of her first forays into government work in 1985 was working on an investment agreement with China.

"At that point it was probably the most frustrating thing I'd ever experienced and probably remained the most frustrating thing I experienced through my career."

She said that 30 years ago there "was just no meeting of the minds on anything."

"Fast forward to now and we're busily negotiating the text of this agreement."

Talks are continuing despite rising tensions between the two economic powerhouses. 

On Monday, Obama, who made strides across several policy areas during his November trip to China, said he is deeply concerned about Beijing's plans for new rules for U.S. tech companies.

"This is something that I’ve raised directly with President Xi," Obama said in an interview with Reuters.

"We have made it very clear to them that this is something they are going to have to change if they are to do business with the United States."

There have been 18 BIT negotiating rounds since 2008, State Department officials said.