U.S. trade rep outlines concerns over China in Shanghai speech
While the U.S.-China trade partnership is the most important such relationship in the world, America remains concerned about trade imbalances, intellectual property rights and currency flexibility, said Karan K. Bhatia, deputy U.S. Trade Representative, in a speech Tuesday at the Shanghai Institute of Foreign Trade,
'There is concern that, while the United States has fulfilled its commitment to open its market to Chinese companies, China is not fulfilling its part of the bargain,' Bhatia said. 'There is growing frustration that China is not 'playing by the rules.' The huge and growing bilateral trade imbalance has served to fuel these concerns. I am sure you can imagine that there would be similar concerns here if our positions were reversed and China was running a $202 billion trade deficit with the United States.'
Bhatia specifically focused on intellectual property rights as an area where China must rapidly improve.
'IPR enforcement problems in China also affect us in markets outside of China,' he said. 'Last year, for example, 69 percent of IPR infringing goods seized by U.S. customs at the U.S. border had originated in China. A 2005 white paper issued jointly by the American Chamber of Commerce in China and the American Chamber of Commerce in Shanghai reported that 80 percent of 331 American companies surveyed described China's IP protection as 'ineffective' or 'totally ineffective.' Of course, the failure to protect intellectual property also hurts innovative Chinese companies, and could undermine China's efforts to continue to foster an even more dynamic, knowledge-based economy.'
Bhatia also spoke on China's currency, which is pegged to the U.S. dollar.
'China can also contribute to the global economy by helping to facilitate the adjustment of global macroeconomic imbalances by increasing the flexibility of its currency and allowing it to demonstrate greater responsiveness to market forces,' he said. 'Accelerating financial sector and currency reform would not only demonstrate that China is doing its part to contribute to the stability of the global economy, but would benefit China's economy as well.'