U.S.-CHINA TRADE TENSIONS : Two Sides Will Reopen Talks as Sanctions Loom : Standoff: Kantor is pleased by Beijing’s quick response to threatened penalties. But he warns that piracy of products must stop.
Barely 48 hours after slapping China with the most massive trade sanctions ever, the White House announced Monday that U.S. and Chinese representatives will resume negotiations next week as they try to back away from a potential trade war.
But even as the two nations sought to ease a seemingly intractable dispute over piracy of videos, compact discs and other copyrighted products, U.S. Trade Representative Mickey Kantor said that “piracy of U.S. products is an extremely serious problem,” and he continued to insist that the practice must be curbed in China.
The sudden return to the bargaining table reflects the frequent course of U.S.-Chinese negotiations, indeed of most trade negotiations. It is common for the threat of an approaching deadline to bring the arguing parties back together.
Kantor, President Clinton’s senior trade adviser, was notably upbeat at midday Monday when he announced that in response to an invitation received Sunday night from his Chinese counterpart, Trade Minister Wu Yi, the United States would send a negotiating team to Beijing to resume talks next Monday. The negotiations broke off Jan. 28.
“It’s a step in the right direction,” Kantor said of the plan to resume talks. “We’re delighted and impressed by the rapid response from the Chinese government.”
The talks are being conducted under the shadow of stiff economic penalties on both sides if the dispute is not resolved quickly.
Kantor announced Saturday that the United States would impose tariffs, or import taxes, of 100% on more than $1 billion worth of Chinese goods sold in this country, beginning Feb. 26. That would double the price of a wide variety of imported Chinese goods, ranging from picture frames to surfboards. The Chinese immediately said they would retaliate with 100% duties on such U.S. goods as camera film, cigarettes and cosmetics sold in China.
The Clinton Administration’s goal is to force China to crack down on the theft of so-called intellectual property, the fruits of creative endeavors such as the invention of pharmaceuticals, computer software design and artistic pursuits. Chinese laws prohibit such piracy, but Washington has complained bitterly that they are not enforced.
Chinese factories are purportedly turning out 75 million compact discs annually, as well as software and other goods, without paying fees to artists and other license holders, costing American inventors, musicians, composers, artists and other copyright holders huge sums in missing royalties.
*
At the same time, the United States is pressing to gain broader access to the Chinese market for American companies, hoping to make it possible to sell licensed U.S. videos, for example, in place of illegally copied tapes.
“If you don’t have market access, if they don’t allow these products to be sold in China and protected, then of course you’ll never be able to address the piracy issue,” Kantor said at a news conference.
U.S. relations with some of its trading partners have gone to the brink before.
The Bush Administration announced in 1992 that it would impose 200% tariffs on $300 million worth of European goods, including French wines. The tactic had the desired result: A long-running agricultural dispute was resolved two weeks before the taxes were to take effect.
The immediate readiness of the Chinese to resume negotiations--after refusing to talk all last week as a Feb. 4 deadline for announcing the sanctions loomed--gave some hope to Kantor and others on the U.S. negotiating team.
“I don’t know how China could have responded more quickly,” Kantor said.
He added, “We expect the Chinese to come to the table prepared to address our concerns over the protection of computer software, chemical and agricultural products, pharmaceuticals, trademarks, audiovisual works and books and periodicals.”
