Why would the U.S. consider a bilateral investment treaty with China?
As the Wall Street Journal's John Bussey reports, last week's U.S.-China Strategic and Economic Dialogue (S&ED) concluded with a joint pledge to negotiate a "bilateral investment treaty."
As we pointed out last week, the idea is questionable at best.
Michael Wessel, an adviser to the Alliance for American Manufacturing (AAM) and a commissioner on the U.S.-China Economic and Security Review Commission, said that an investment treaty offers little of promise for the U.S. economy:
"Why on earth would our negotiators think that China would actually live by their promises? A BIT, at this point, is a terrible idea. Our goal should be to find ways to promote investment by U.S. companies in the U.S. market, not to ease the way for them to invest more into China and to grease the wheels for China’s investment here -- a substantial portion of which will benefit from state support. The Chinese and the investment bankers are licking their chops at the prospect of this one-sided deal.
"This is like Lucy holding the football for Charlie Brown. Our negotiators will blindly pursue the negotiations, only to find, once again, that the Chinese will renege on their promises and deposit more profits from our market into their banks."
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