Trump's move on trade raises 'grave concern'

China voiced "grave concern" over US President Donald Trump's order for a study of whether an investigation into China's intellectual property policies and practices was warranted.

The executive memorandum that Trump signed on Aug 14 instructed US Trade Representative Robert Lighthizer to explore whether to investigate any of China's laws, policies, practices or actions that may be unreasonable or discriminatory, or may be harming US intellectual property and innovation technology.

China's Ministry of Commerce responded on Aug 15 that China will take all necessary and appropriate measures to protect its commercial and trade interests if the US government wrongly accuses China over alleged theft of US technology and intellectual property.

The United States should cherish the currently sound Sino-US trade relationship and economic cooperation, it said. Any unilateral practices of trade protectionism from the US are doomed to damage the bilateral economic and trade relations and corporate interests on both sides, according to a statement from the ministry.

Section 301 of the Trade Act of 1974 allows the US president to unilaterally impose tariffs or other trade restrictions to protect US industries.

In recent years, China has taken an active stance in opening up to the outside world as well as providing a better environment for foreign investment and business operations in China. It had taken the initiative to repeatedly revise the Catalogue of Industries for Guiding Foreign Investment, trimming 117 restrictive measures since 2011, the ministry statement said.

The country always attaches great importance to intellectual property rights and constantly tries to perfect legislation in the area and strengthen administrative and judicial protections, it said.

Trump's move has triggered opposition from the Chinese government and concerns of strained trade relations between the world's two largest economies.

In Beijing on Aug 14, Foreign Ministry spokeswoman Hua Chunying said that "any member of the WTO should observe its rules in taking trade measures," a view shared by the Ministry of Commerce.

Trump's action came at a sensitive time, coinciding with his tweet last week that if China helps more on restraining the nuclear weapons program of the Democratic People's Republic of Korea, he might think differently about trade issues. But a senior White House official indicated that the two issues were not related.

Hua said at the daily briefing, "It is obviously improper to use one issue as a tool to exercise pressure on the other."

The study that Trump requested could take up to a year and a 301 investigation, if launched, would take additional time, says Henry Levine, a senior adviser at the Albright Stonebridge Group in Washington and a former US deputy assistant secretary of commerce. "Therefore, we are very far from any substantive actions that would create serious problems in US-China relations," he tells China Daily.

Jeffrey Bader, David Dollar and Ryan Hass, three scholars at the Brookings Institution, warn that the risk of a hard-line approach is that China will not change anytime soon, but likely will feel compelled to retaliate, and tit-for-tat protectionist measures would hurt the US and global economies.

Some observers interpret Trump's order on Aug 14 as a move to show his supporters that he is keeping a campaign promise.

Contact the writers at chenweihua@chinadailyusa.com

(China Daily European Weekly 08/18/2017 page14)