Title: The US-China economic relationship: A comprehensive approach
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The US-China economic relationship: A comprehensive approach
Executive Summary
Joshua P. Meltzer
Senior Fellow - Global Economy and Development
Neena Shenai
Visiting scholar - American Enterprise Institute
The state of the bilateral economic relationship
Why China’s economic model matters
The impact on the WTO
Making progress in US-China economic relations
Bilateral negotiations
The role for the WTO
Work with US allies
Unilateral US action

Content: The U.S. and China should make such a deal WTO consistent by seeking a WTO waiver. Such an approach is a pragmatic compromise that recognizes that the U.S. and China will likely focus on bilateral negotiations to address their trade issues, while minimizing the harm to the WTO as an institution. The U.S. and China should also renew efforts to complete a comprehensive bilateral investment treaty (BIT) with an aggressive nine-month schedule. A bilateral deal should avoid commitments by China to increase purchases of U.S. exports, and reducing the bilateral trade deficit should not guide the negotiations or determine success. Increased U.S. exports, whether to China or elsewhere, need to be in response to market forces and not undercut broader U.S. demands for less state intervention. Such an arrangement would be inconsistent with U.S. values, adopt a managed trade framework more akin to the Chinese model, would likely be WTO inconsistent,