The U.S. ambassador to China on Friday called on China to ease restrictions on investments by foreign and domestic companies and open its economy to greater foreign participation.

U.S. ambassador Gary Locke. [File photo]

Speaking Friday afternoon at an economic summit in Beijing, Gary Locke said China should open up industries such as energy, financial services and telecommunications, where foreign competitors face "substantial restrictions," and work harder to enforce intellectual property rights.

Such policy changes, he said, would be both in China's interest and in the interest of economic recovery in developed countries.

"The single largest barrier to improved U.S.-China economic cooperation is a lack of openness in the Chinese economy," Locke said. "And if this lack of openness continues, it will mean less innovation from Chinese businesses, fewer opportunities for the Chinese people and slower growth for the Chinese economy."

Despite government meddling, China has continued to attract a surge of foreign investment. According to Commerce Ministry data released last week, China attracted US$95 billion in foreign direct investment in the first 10 months of this year, 15.9 percent more than the same period in 2010, even as FDI from the U.S dropped 18.1 percent.

Locke also said the United States would work to achieve President Barack Obama's goal of doubling exports to China by 2015. He said the U.S. economy is on track to meet that target; U.S. exports to China grew by almost 32 percent last year, nearly twice as fast as overall U.S. export growth, and figures indicate similar expansion this year.

Locke said he will lead five trade and investment missions next year to China's emerging cities in a bid to ensure strong U.S. export growth in China continues.

At the same time, Locke added, China should do its part in rebalancing the global economy by taking steps to stimulate domestic consumption.

"The need for change is reflected in China's latest five-year plan, with its focus on expanding domestic consumption, reducing energy and carbon dependency, expanding the services sector and fostering innovation in new industry," Locke said. "But there's a gap between the goals it has identified in its five-year plan and the steps it is taking to achieve them."

Locke said China must also continue to devote attention to improving intellectual property protection, which costs foreign businesses in industries such as pharmaceuticals, biotechnology, advanced manufacturing and entertainment billions of dollars a year.

Legitimate software sales in Vietnam exceed those in China, a country with a population 15 times that of Vietnam, Locke said, citing figures from the Business Software Alliance, a trade group.

The remarks come as the U.S. economy continues to struggle with high unemployment and slow growth. National unemployment in the United States saw a slight downtick in October, falling to 9 percent from 9.1 percent in September.

But faced with instability in Europe and uncertainty over future growth, employers were reluctant to hire. The U.S. economy added 80,000 jobs last month, the fewest in four months.

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