President Donald Trump today ordered a probe into China’s “unfair” trade practices and “theft” of American intellectual property, drawing a sharp reaction from Beijing which warned that it “will not sit idle” in the face of punitive US actions. Trump signed a memorandum that directs US Trade Representative Robert Lighthizer to determine whether an investigation is needed into alleged unfair Chinese trade practices. Shortly after Trump signed the directive, Lighthizer said his office will launch a probe and, “if needed, take action to preserve the future of US industry”. Trump’s action comes amid rising tensions between the two nations over provocative missile tests and threats by Beijing’s ally North Korea. “The theft of intellectual property by foreign countries costs our nation millions of jobs and billions and billions of dollars each and every year. For too long, this wealth has been drained from our country while Washington has done nothing,” Trump said. “Today, I’m directing the United States Trade Representative to examine China’s policies, practices, and actions with regard to the forced transfers of American technology and the theft of American intellectual property,” Trump said as he signed the memorandum. “As President of the United States, it’s my duty and responsibility to protect the American workers, technology, and industry from unfair and abusive actions,” he said. Trump said his administration will stand up to any country that unlawfully forces American companies to transfer their valuable technology as a condition of market access.
Following Trump’s order and his remarks on crackdown on unfair trade practices, China’s commerce ministry issued a stern statement voicing “serious concern” and warning that any punitive measures will harm bilateral trade relations. “If the US side takes actions that impair the mutual trade relations, disregarding the facts and disrespecting multilateral trade rules, China will not sit idle,” the statement said. China “is definitely going to adopt all appropriate measures to vigorously defend” its lawful rights and interest, it said. The country has “always been paying high attention to intellectual property right protection, continuously perfecting the legislation”, and that the progress it has made on that front is “obvious to all”, the commerce ministry said.
Trump said the US will combat the counterfeiting and piracy that destroys American jobs and enforce the rules of fair and reciprocal trade that form the foundation of responsible commerce. “We will protect forgotten Americans who have been left behind by a global trade system that has failed to look — and I mean look — out for their interests. They have not been looking out at all,” he said.
Trump said the US Trade Representative Lighthizer is empowered to consider all available options at his disposal. “We will safeguard the copyrights, patents, trademarks, trade secrets, and other intellectual property that is so vital to our security and to our prosperity. We will uphold our values, we will defend our workers, and we will protect the innovations, creations, and inventions that power our magnificent country,” he said. Lighthizer said the US has for many years been facing a very serious problem. “China industrial policies and other practices reportedly have forced the transfer of vital US technology to Chinese companies,” he alleged. “We will engage in a thorough investigation and, if needed, take action to preserve the future of US industry. Thousands of jobs are at stake for our workers and for future generations. This will be one of USTR’s highest priorities, and we will report back to the President as soon as possible,” Lighthizer said.
Top American lawmakers welcomed the move. “I am pleased that President Trump has targeted China’s forced technology policies. These practices have unfairly forced American companies to surrender vital intellectual property to their Chinese competitors as the price for doing business,” said House Ways and Means Committee Chairman Kevin Brady. Democratic Leader Nancy Pelosi alleged that for years now, China’s brazenly unfair trade practices have weakened America’s economy and hurt American workers.
Pelosi asked USTR to take steps against China’s theft of American trade-secrets, China’s piracy of other American intellectual property, including software and market barriers facing US businesses and products in China. The bipartisan IP Commission also welcomed Trump’s decision.
“The scale of Chinese forced transfer and theft of American intellectual property threatens these interests, both our prosperity and security, and thus US policy must address this set of issues,” said Dr Richard Ellings, director of the IP Commission and president of National Bureau of Asian Research.