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October 17, 2018

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US claim of ‘forced technology transfer’ baseless

IN the latest round of mud-slinging against China, the United States has once again resorted to the usual hackneyed charges of “forced technology transfer” and “intellectual property theft.”

Those allegations have very little to do with the facts of the matter, belittling China’s technological achievements, and amount to nothing but blow and bluster, just the latest attempt by the global hegemon to stymie the ascent of the world’s largest economy.

China’s remarkable scientific and technological progress is the result of years of hard work by generation after generation of Chinese researchers — much as the rise of American technology once was — and for sure owes a lot to international cooperation.

China has indeed learnt a great deal from developed countries, but that is no more than the United States did from the 19th century until World War II.

During that period the States had no scruples in how it attracted or “acquired,” for want of a better word, technology and talent from across the world.

Nowadays, the United States outperforms many countries in basic research, while China excels in applied research. That is a reasonable result of the two countries’ strengths in personnel, markets and resources.

However, in a speech on Washington’s China policy earlier this month, US Vice President Mike Pence recycled the irrelevant half-baked homily that China has been forcing foreign companies to transfer technology and steals intellectual property.

Sober minds

The accusation is so pathetic that even sober minds in the United States are not buying it. Larry Summers, a former US Treasury secretary under Bill Clinton and an economic advisor to Barack Obama, said in June that China’s progress comes from “terrific entrepreneurs who are getting the benefit of huge government investment in basic science,” and “an educational system that’s privileging excellence, concentrating on science and technology ... not from taking a stake in some US company.”

At a recent hearing by the Office of the US Trade Representative regarding proposed tariffs on Chinese products, many US companies testified that they had never been forced to transfer any technology to Chinese entities.

Meanwhile, as witnessed by the international community, China has made great strides in formulating and improving its laws and regulations on intellectual property rights (IPR) protection in recent years.

World Intellectual Property Organization Director General Francis Gurry said just two months ago that China has established an IPR protection system that regards intellectual property as the driving force for innovation and economic development and treats Chinese and foreign companies equally.

Without any doubt, technology transfer abounds between Chinese and foreign entities, but it is rooted in the pursuit of profit. US companies have made huge gains in China from technology transfer and licensing. According to the US Bureau of Economic Analysis, China paid US$7.95 billion in 2016 and US$8.76 billion in 2017 to the United States for the use of intellectual property.

Thus, such condemnation of normal commercial practices is a mockery of the spirit of contract. More ironically, one of Washington’s frequently used weapons to curb other countries’ development is to impose high-tech export bans.

Authoritative research reports have repeatedly suggested that should the United States relax its strict restrictions on high-tech exports to China, its trade deficits would decrease significantly. But Washington has continued to be obstinate.

 As many have pointed out, the ongoing trade frictions between China and the United States betray Washington’s anxiety over China’s increasing scientific and technological strength.

That angst is self-inflicted.

Beijing is committed to peaceful development and win-win cooperation. What’s more, if China and the United States, the top two economies and investors in scientific and technological research on the planet, can join forces, the whole world will benefit.

Given that, it is high time that Washington abandon its zero-sum mentality and embark upon the path of win-win cooperation instead.




 

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