06 December 2012 15:49 [Source: ICIS news]
By Joe Kamalick
WASHINGTON (ICIS)--A special US commission set up to monitor China’s compliance with trade laws has urged Congress to bar some Chinese companies, products and investments in retaliation for what it describes as persistent and pervasive unfair business practices and industrial espionage by Beijing.
In its 10th annual report to Congress, the US-China Economic and Security Review Commission (USCC) said that a wide range of Chinese unfair trade practices, banking and currency policies and outright espionage are flagrant violations of ?xml:namespace>
The commission was established by Congress when in 2001 – over the objections of many in Congress and among other
As part of the deal in being granted WTO membership,
Many in Congress were deeply suspicious of
But according to the commission, 10 years after being granted WTO membership – a critical achievement for
The panel blamed
In 2011, the
“Currency appreciation levelled out in 2012,” the commission said, adding: “The renminbi (RMB) did not appreciate as much as in 2011, and there are even signs that the Chinese government may devalue the RMB to boost exports.”
“The same subsidies and preferences enjoyed by the state sector in
USCC noted that 2011 was the 28th straight year in which the
“China’s state-directed financial system and export-driven growth model; its market barriers to various US exports; its discriminatory policies that favour domestic companies over foreign investors; rampant Chinese theft of intellectual property; and China’s unreliable rule of law and its inconsistent adherence to WTO commitments continue to disadvantage American competitors,” the commission said.
For example, the commission noted that the banking system in
“SOEs are the principal borrowers, while entrepreneurs and private companies find it hard to obtain loans, even at higher rates,” the report said, calling the situation “financial repression”.
In addition to a variety of unfair trading and financial practices, the commission charged
The report noted that
Those strong similarities, right down to the J-20’s cockpit configuration, said USCC, “revives concerns that espionage may have played a role in the jet’s development”.
In addition, said the commission,
“US industry and a range of government and military targets face repeated exploitation attempts by Chinese hackers as do international organisations and nongovernmental groups including Chinese dissident groups, activists, religious organisations, rights groups and media institutions,” the report said.
The commission also reminded Congress that the
The report further pointed out that “
To help level the playing field, the commission urged Congress to require a mandatory review of transactions by Chinese state-owned and state-controlled companies investing in the US and prohibit investment in a US industry by a foreign company whose host government bars foreign investment in that same sector.
The report’s recommendations also call for an annual Commerce Department report on Chinese investment in the
On the rare earths front, the commission urged Congress to establish an interagency task force to develop a government-wide definition and list of foreign-sourced minerals critical to
USCC said that the interagency task force should include the departments of Defense, Commerce, Energy, Interior and State, among others.
The goal, said USCC, is to “develop a plan regarding those minerals to reduce the vulnerability of the
($1 = €0.76)
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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