The real stakes in US-China trade dispute


By Eva Cheng

China and the US have locked horns repeatedly over trade issues in recent years, from the most favoured nation (MFN) benefits to the General Agreement on Tariffs and Trade (GATT) membership and from trade balances to intellectual property rights.

The recent dispute over intellectual property rights (IPR) has implications not only for China and the US but also for the Third World's efforts to obtain its fair share of the benefits from humanity's scientific and technological heritage.

A hasty reading of the establishment press leaves the impression that the recent dispute concerned only Chinese factories pirating CDs and audio and visual tapes. But something more than protecting copyrights and trademarks of US companies was involved. This is why the debate is likely to continue despite the Chinese concessions.

IPR have been gradually redefined by the industrialised countries, especially the US, into something very different from the copyright for literary and artistic works created by international forums like the Berne Convention of 1886 and the UNESCO-sponsored Geneva Convention of Universal Copyright (1952).

In the GATT negotiations leading to formation of the World Trade Organisation (WTO), many items that used to be industrial property were included under the banner of intellectual property. Just about anything that involve the input of human minds could be included.

The result, which is entirely intentional, is to strengthen the scientific and technological domination of the developed countries as a means of further exploiting the Third World. A newly discovered gene or an altered species has become patentable. A farmer in the Third World who sows a seed or breeds an animal could be liable for royalties if it carries a patented gene or characteristic.

This gives big business, which has the resources to stay ahead in technology and research, claims over humankind's common heritage in biology and science for the generation of private profits.

It is these intellectual property rights that the US government was determined to protect, much more than copyright for things like computer programs, compact discs and integrated circuits. These sorts of items, which are more readily accepted by public opinion as deserving protection, became a cover to legitimise the new form of IPR.

The United States has of course used almost every weapon except the truth in its dispute with China on this and other trade issues.

Since the Tienanmen massacre in 1989, the US has used human rights as a pretext to threaten withdrawal of China's MFN status, loss of which would undercut Chinese exports to the US. Human rights sound a far loftier note than reference to China's US$23 billion trade surplus with the US. And it is very convenient for any US company suffering from Chinese competition to be able to complain that it is competing against products of "slave labour".

China's records on human rights is appalling, but that does not excuse US hypocrisy in defending human rights only selectively, or when it suits its other needs. MFN is a big stick that can be waved for other agendas, including making sure that China doesn't set a "bad example" for other Third World countries by showing insufficient respect for the trade rules favoured by Washington.

In the same way, Chinese membership in the WTO is being held hostage to the same concerns.

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