Trade

US, China officials reach agreement to remove trade barriers

by Vicki Needham - 11/21/11 6:25 PM ET

Still, Kirk and other U.S. officials said despite making headway on several major issues, they underscored that much more work remains to be done to open China’s market to U.S. exports and investment.

“This is a step in the right direction,” Commerce Secretary John Bryson said. “But we must continue to actively engage our Chinese counterparts to open additional opportunities for U.S. businesses.”

China, led by Vice Premier Wang Qishan, committed to stepping up enforcement of intellectual property rights by making permanent its 2010 Special IPR Campaign.

China also plans to increase political accountability, tying the performance of provincial level officials to the enforcement of intellectual property rights in their regions.

“For the first time, China will establish a permanent leadership structure to enforce intellectual property rights,” Bryson said.

“As enforcement becomes effective, those who infringe will no longer be able to lay low until a crackdown is over and then simply resume their illegal activities,” he said.

As part of that plan, officials also vowed to continue the software legalization program, ensuring that the provincial efforts would be concluded by the middle of 2012, and at the local and municipal levels by the end of 2013.

The Chinese government also agreed to continue working to develop solutions to combat the sale of counterfeit goods on the Internet while at the same time moving forward to develop additional protections for legitimate trademarks.

China also announced a new high-level central government mandate requiring provincial and local governments — by Dec. 1 — to eliminate any policies that are not consistent with President Jintao Hu’s commitment to sever the link between China’s innovation policies and government procurement.

“This issue has been a top priority of the American business community,” Kirk said.

The U.S.-China Business Council (USCBC), an organization representing nearly 240 world-class U.S. companies selling American goods and services to the China market, welcomed the progress.

“As we have stated repeatedly, American companies face real challenges when doing business in China and have significant concerns about their ability to compete on a level playing field,” said USCBC President John Frisbie. “More details will be needed in the coming days, but today’s announcements are a positive step forward for U.S.-China commercial relations.”

China confirmed that it hasn’t been and won’t require foreign automakers to transfer technology to Chinese enterprises or establish Chinese brands to invest and sell in their own market.

China also said foreign businesses are eligible on an equal basis for electric vehicle subsidies and other incentive programs.

Also, the Agriculture Department and China’s Ministry of Agriculture are finalizing the framework of a five-year strategic plan focused on food security, food safety and sustainable agriculture.

Officials said progress was made on improving access for U.S. beef, removing avian influenza-related bans affecting several U.S. states for pears and creating a new dairy certificate to maintain existing market access.

In the next five years, China plans to invest $1.5 trillion in its strategic emerging industries, which China defines as high-end equipment manufacturing, energy-saving and environmentally friendly technologies, biotechnologies, new generation information technologies, alternative energy, advanced materials and new energy vehicles, according to the U.S. trade representative’s office.

China also expanded the U.S.-China Tourism Memorandum of Understanding to three additional provinces for a total of 27 provinces. Spending by Chinese visitors is expected to grow 232 percent to $16.6 billion by 2016, moving up from the seventh largest U.S. market in 2010 to the third in 2016.