U.S.-CHINA: U.S. set to propose trade sanctions

• by IPS Correspondents (washington)
• Friday, December 30, 1994
• Inter Press Service

WASHINGTON, Dic 30 (IPS) - The administration of U.S. President Bill Clinton is expected to propose imposing one billion dollars in trade sanctions against China for not respecting intellectual property rights (IPR), U.S. officials said Friday.

The announcement is due Saturday when a six-month investigation into alleged IPR violations formally expires.

Described by the Wall Street Journal as a "significant escalation" in an ongoing trade battle between Beijing and Washington, Saturday's announcement will set in motion a process that could result in the imposition of sanctions within three months.

The action takes place against a backdrop of increasing trade tensions arising by China's bid to become a charter member of the new World Trade Organisation (WTO) which opens its doors in Geneva early next week.

China has charged Washington with blocking its application to join the WTO until it agrees to better enforce IPR, which includes copyrights and patents, and open its markets to high-tech imports and financial services more quickly than it is currently planning.

On Dec 20, talks on the terms for China's entry into the WTO broke off until some time next year.

U.S. copyright- and patent-holders claim they lose more than 800 million dollars a year in goods, especially computer software and compact discs (CDs), pirated in China. They have identified 26 factories which produce millions of counterfeit CDs annually, according to a recent report in the influential Business Week magazine.

Washington wants Beijing to shut down these enterprises and similar firms whose activities form the core of the investigation carried out against China over the past six months.

Adding to U.S. anger is a mushrooming trade deficit with China estimated at 29 billion dollars this year. Only Japan enjoys a higher surplus with the United States.

U.S. and Chinese officials have met several times since June when the IPR investigation was first launched, but no agreement has been reached.

Saturday's announcement will likely include a list of textile, apparel, toys and electronic products to be targeted for prohibitively high tariffs unless a new accord is struck, according to the Journal.

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