CHINA: U.S. Secretary of Commerce Carlos Gutierrez warns China's rampant piracy will jeopardize future trade relations between the two countries

U.S. Commerce Secretary Carlos Gutierrez said on Tuesday (November 14) rampant Chinese counterfeiting is undermining U.S. support for expanding trade between the two countries. Gutierrez told business executives in Beijing that illegal copying of films, music, medicine and industrial goods was a threat to consumer health and safety. Gutierrez said piracy was costing U.S. industry an estimated $2.3 billion a year from lost copyright revenues. He also said that U.S. customs had been ramping up seizures of counterfeit goods coming to the United States. In 2005, U.S. customs made 8,000 seizures valued at $93 million, but this year customs had made over 14,000 seizures valued at over $156 million. "And let me just be frank. Another victim of wide-spread IP (Intellectual Property) theft in China is American support for expanding our trade relationship. Those who espouse protectionism, those who would like to see protectionism policy put in place as a legitimate economic policy have a very loud voice. And they cite specific imbalances," Gutierrez said. He praised China's leaders for stepping up punishment of counterfeiters, but urged authorities to make further efforts to combat widespread piracy. "There are more infringing goods from China than from all countries combined. We know that this is something that the Chinese government doesn't want either, so we are working together to ensure that we decrease this and ultimately stamp it out," Gutierrez said. The comments from the United States' top commerce official were the latest in a barrage of demands from Washington and the European Union for China to stop commercial pirates copying films, music, software, industrial parts and medicines without paying fees. U.S. copyright industry companies claim bootleggers cost them $2.6 billion in sales in China last year. On Beijing streets, pirate DVDs cost about $1 or more, much cheaper than legitimate copies sold in wealthy countries. "The reality, of course is that we are still behind the criminals and pirates. We must contribute to anything we can do to continue to bring their names to light and to bring them to justice and to ensure that we have all the right information, that we are sharing information so we can be as effective as possible. We have to continue to attack the production and the global distribution of illicit goods with every single tool at our disposal," Gutierrez said. Gutierrez, visiting China with over two dozen U.S. executives who hope to expand business, is seeking to narrow a widening trade gap between the two countries that has led to a political backlash in the United States. During his talks with Chinese officials he pushed for more market access and better legal protection of U.S. products, especially the film industry that suffers huge losses in China due to piracy. "And we believe that because there is a limit that those motion pictures that are not allowed to the country come to the country through illegal means. So that one way of stamping out piracy is to open the market and to have market access and to have more room for the sale of the legitimate goods," he said. The trade gap was 23 billion dollars in September, up from 22 billion in August, as imports from China rose 3.3 percent to a record 27.6 billion dollars, the department said last week. Washington has warned of going to the World Trade Organisation with a formal complaint about China's pirates - a dramatic step in international trade diplomacy. US critics charge that China keeps its currency weak to gain an unfair trade advantage, allowing it to boost exports at the expense of US manufacturing jobs. The Democratic Party's victory in last week's Congressional polls is widely expected to make for a harder US line on trade disputes with China. His visit comes on the heels of that last week by European Union Trade Commissioner Peter Mandelson, who highlight similar problems. TRADE RELATIONS INTERNATIONAL TRADE

ITN Source | November 14, 2006

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