US economy

Intellectual Property to Take Center Stage as Trump and Xi Meet


Then there is actual espionage. A report last summer by the White House’s Office of Trade and Manufacturing Policy, led by Peter Navarro, accused China of “economic aggression” and laid out a detailed case explaining the costs of China’s cyberespionage campaigns.

The analysis pointed to China’s cyberintrusions of American companies, its evasion of American export-control laws and its extensive efforts to reverse-engineer and counterfeit American products. It pointed to a study that found the annual cost to the United States economy of pirated software and counterfeit goods could be as high as $600 billion.

Beyond tariffs, the United States has using more proactive means to protect intellectual property.

In October, the United States blocked a Chinese state-owned technology company — Fujian Jinhua Integrated Circuit, a manufacturer of semiconductors — from buying American components because it posed a national security threat. Then, three days later, the Justice Department charged the company, its Taiwanese partner and three individuals on Thursday with stealing trade secrets from an American technology company.

The Trump administration is increasingly invoking national security to block Chinese deals, most recently expanding the powers of the Committee on Foreign Investment in the United States, to more rigorously scrutinize a broader range of transactions.

These accusations of “theft” have offended the Chinese, who view them as a suggestion that the country lacks the ability to innovate. Cui Tiankai, China’s ambassador to the United States, has argued that American companies are voluntarily merging with Chinese businesses because nobody is forcing them to expand their operations into China.

“I think all these accusations about how China has developed are groundless and not fair to the Chinese people,” Mr. Cui told Fox News last month. “It would be hard to imagine that one-fifth of the global population could develop and prosper, not by relying mainly on their own efforts, but by stealing or forcing some transfer of technology from others.”

Some China experts such as Derek Scissors, the American Enterprise Institute scholar who advised the Trump administration on its report on China’s intellectual property practices last year, contend that China has gone so far to keep out foreign competition that it has stunted its ability to innovate.



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