China Newspaper Fires Back at USTR Section 301 Investigation Into Forced Tech Transfers, IP Policies

The Office of the U.S. Trade Representative’s initiation of a Section 301 investigation into reportedly unfair Chinese forced technology transfers and intellectual property policies could “severely” undermine the U.S.-China bilateral relationship, Chinese government media reported on Aug. 28. “Until recently, it had been hard to see where the next financial crisis could come from,” says an article published by China’s Global Times. “But imposing trade sanctions could trigger the pricking of China's credit bubble, engendering social and political unrest, exacerbating China's economic woes and thwarting its economic advance.”

Under a headline citing “US belligerence,” the article goes on to predict that the U.S.’s next “attack” is likely labeling China a currency manipulator and states the best “alternative” for China is to replace its U.S. export market with another country's. “Otherwise, to avoid a trade war, China will probably need to remove the so-called barriers that hamper exports to China by US hi-tech companies,” the article says. “China might also have to tolerate some protectionism in sectors -- such as steel -- in some US rust-belt states that supported Trump's election as president.” USTR’s investigation could result in retaliation against China, including duties, if practices are found to burden or restrict U.S. commerce (see 1708210024).