Back From the Brink
The United States finally wrung from China another agreement on intellectual property rights recently - just short of the deadline for imposing $2 billion in trade sanctions.Skip to next paragraph
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This was no glorious triumph for the Americans, however. Acting US Trade Representative Charlene Barshefsky acknowledged it was another incremental step toward order in a realm of international commerce where rules have long been bent or ignored. Copyright infringement of creative products like business software and entertainment recordings has been rampant.
The Chinese agreed to stricter enforcement of a pact made last year to control the pirating of US products. They sealed their good faith by shutting down two more factories where black-market copies of CDs are churned out, bringing to 19 the total of such closings. Beijing also pledged to strengthen its police and customs operations against the pirates. US customs officials will have better access to the data compiled by Chinese authorities.
Both sides were anxious to find a way of avoiding a sanctions barrage. China had readied retaliatory measures against US goods, but despite the bluster, it couldn't have relished the prospect of a trade war that could put the brakes on its expansion into world markets and threaten its most-favored-nation trade status with the US. On American shores, numerous companies were dreading a possible shut-off of clothes, toys, and other products flowing in from China. And the Clinton administration didn't want a trade blowup with China grabbing headlines and distracting voters.
The two countries have a tableful of unsettled issues. While it was discussed at the latest go-around, greater freedom for US entertainment companies to sell their products in China remains a point of contention, with Beijing wanting strict control. Beijing has also moved to control the operations of foreign communications firms selling economic information in China.
So the intellectual-property realm continues to seethe, but at a slightly lower temperature. If commitments are honored, the mid-June agreement should herald greater cooperation and a retreat, we hope, from chronic trade brinkmanship.