Highlights from the U.S.-China 4th Annual Strategic Economic Dialogue

Wednesday wrapped up the 4th round of the Strategic Economic Dialogue (SED) between the U.S. and China. The SED was first introduced in September 2006 as a biannual event to promote stronger ties between the U.S. and China and to establish a foundation from which both nations could openly discuss bilateral investment and trade issues. Representatives from both countries acknowledge and stress that continued future cooperation and open dialogue between the two countries is essential to the economic development of the two nations.

In what both parties hailed as a successful meeting, the two-day dialogue discussed such issues as the development and protection of each country’s human capital, investment in the countries, and opportunities for advancing cooperation in the energy and environmental sectors. In fact, both parties signed a 10-year agreement on energy and environmental protection after the meeting, an important move that signified China’s awareness that with a rapidly expanding nation of 1.3 billion people, it cannot continue to use energy at its current rate without regard to the environment, a particularly sticky issue that has not only economists and environmentalists nervous, but athletes preparing for the upcoming Beijing Olympics uneasy.

Chinese Vice Premier Wang Qishan and U.S. Secretary of Treasury Henry Paulson also announced at the SED that both countries would begin talks on negotiating a bilateral investment accord between the two countries. Likely topics of common interest for both sides would include the U.S. mortgage loan crisis, global financial issues, and intellectual property rights. A bilateral investment agreement between China and the U.S. would build investment confidence, especially U.S. investment in China, where transparency is not always present.

Just a week ago, China had urged the U.S. to lift its export restrictions in order to reduce trade barriers between the countries. As if in response to this, at the close of the 4th SED, both GM and Ford Motor signed 1 billion and 800 million dollar contracts, respectively, with China for more exports, including exports of GM’s Cadillac brand, a move that showcases China’s growing demand for not just automobiles, but luxury automobiles. GM’s contract with China further demonstrated GM’s determination to maintain its position as the leading automaker in the Chinese market, a market that in recent years has shown itself to be more selective and demanding.

AES Mandatory As of July 2

According to notice posted by the Census Bureau, mandatory AES officially begins July 2, and the 90 day implementation period will end September 30, 2008. This means that all exporters should begin looking to make their transition to the AES system or AES Direct system as soon as possible. After September 30, 2008, the SED will officially be extinct.

Census has also posted a Mandatory AES FAQ that may answer many questions about the transition process not addressed in our prior article.