Amid growing worries in the United States over a Chinese government-led effort to make the country a global leader in microchips, electric cars and other crucial technologies of the future, the Trump administration is preparing a broad move against China over trade, according to people with knowledge of its plans, says the media.
Partly because the U.S. administration officials have become frustrated by China’s reluctance to confront North Korea over its nuclear and ballistic missile programs, noting a shift by the administration away from its emphasis on greater cooperation between Washington and Beijing, this latest move could come as early as in the next several days.
While American companies have complained they face pressure to share trade secrets with Chinese partners, and despite claiming modest progress earlier this year, the two sides have also struggled in trade negotiations.
The media quoted three people with a detailed knowledge of the administration’s plans saying that alleged Chinese violations of American intellectual property would be most likely be the focus of the trade case. The sources were not named in the media because the deliberations are not yet public.
The attention of Trump administration officials has bene caught by China’s policy to become a leading manufacturer by 2025 in the fields of semiconductors, artificial intelligence, driverless cars, medical devices, robotics and many other technologies. China intends to ac hive this with the help of massive infusions of state money and the protection of those industries from American competitors and this program is known as the Made in China 2025 which sets goals for China to be a global leader in ten fields of industry.
At the same time, the Chinese government has insisted that companies set up joint ventures to do business in China and has demanded that American companies cut the licensing fees that they charge for key patents.
The office of the United States Trade Representative will start an investigation into China’s trade practice under the process that the Trump administration plans to set in motion. In response to other countries’ burdensome or unfair restrictions on American commerce, the United States could impose steep tariffs on imports, rescind licenses or take other measures following an investigation, which could be completed in as little as a few months. Citing a section of the 1974 Trade Act, the process is known as a Section 301 investigation.
Trump administration officials and trade policy advisers have said that after a crucial meeting in Washington on July 19 between top American and top Chinese officials, the Trump policy of cooperation began to founder. Potentially being portrayed as an “early harvest” in the three months following President Trump’s summit with President Xi Jinping of China last spring at Mar-a-Lago, the meeting had been called with the aim of producing a series of trade deals and the meeting was called Comprehensive Economic Dialogue talks and was overseen by the Treasury and the Commerce Departments.
The deals went significantly beyond what China had previously promised the Obama administration and therefore the two sides were unable to agree on any deals.
(Adapted from CNBC)