Beijing is close to allowing the FBI to establish an office in China to help the United States stop funds flowing to Osama bin Laden's al-Qaeda terrorist group. 'It has been agreed in principle but China is still holding out for further concessions,' a diplomatic source said. The issue was raised when Foreign Minister Tang Jiaxuan visited Washington after the September 11 attacks. A final agreement on this and other measures of co-operation is likely to be settled during talks between President Jiang Zemin and US President George W. Bush. The US wants China to help trace bank account transactions linked to the recent terrorist acts and is lobbying Beijing to implement international treaties related to terrorism and money-laundering. There are more than 12 such treaties, including the 1998 International Convention for the Suppression of Terrorist Bombings. Signatory states are obliged to co-operate with international investigations. China's record in signing such treaties is better than that of the US, but it has not yet set up a body specifically charged with investigating terrorism or drug-related money laundering. The US also is pressing China to join the Asia-Pacific Group on Money Laundering, set up four years ago in Bangkok. Taiwan is a member, as are Macau and Hong Kong, all of which are co-operating with the Financial Action Taskforce on Money Laundering created by the Organisation of Economic Co-operation and Development countries. Hong Kong has set up a financial intelligence unit combining Customs officers and the police but China does not have an operational intelligence unit. If the FBI sets up an office in China, its task would be to help China investigate organisations suspected of being connected to terrorism. Although the police forces of both countries have co-operated informally, China sometimes has been frustrated by the reluctance of law enforcement agencies in the US to help with the extradition of suspects. China also is seeking US co-operation in other fields, including increased measures to smash anti-government agitation in Xinjiang that China blames on terrorist organisations. The US Government gives some support to the Uygur cause by allowing dissident Uygurs to put their message across on Radio Free Asia. In future, China could ask US intelligence agencies to co-operate with China's efforts to track down the source of funding for terrorists suspected of carrying out bombings inside China.