China signs trade pact with U.S. grudgingly
China signs trade pact with U.S. grudgingly
BEIJING (Reuter): China and the United States signed a landmark accord on Saturday to protect copyright in an awkward ceremony that revealed daunting trade differences between the two Pacific giants.
Feisty Foreign Trade Minister Wu Yi, dressed entirely in black, sternly told U.S. Trade Representative Mickey Kantor of a need for mutual respect to remove obstacles "unrelated to trade" that still hinder Sino-U.S. trade ties.
Wu earlier in the day assailed Washington for blocking China's return to the world trade club GATT and vowed to tackle the issue with Kantor. She said at the signing that she hoped their talks would yield "a very good result".
Kantor sounded almost victorious, crediting Wu's "commitment and creativity" with forging the Feb. 26 deal that defused a trade war -- and opened China's entertainment market to U.S. exporters.
"The sign of a good agreement is when both sides are winners and I think this is clearly the case in this agreement on intellectual property," Kantor said.
Wu appeared edgy as Kantor told how the deal would benefit U.S. vendors of copyrighted, trademarked and patented goods, and even more so as he explained how U.S. law enforcers could help China uphold the intellectual property rights accord.
Dozens of U.S. executives who came with Kantor in hopes of translating the pact into new business nodded agreement.
"We are told that there are no quotas any more and that U.S. music can be sold in China," said Jason Berman, who heads the U.S. recorded music lobby.
Berman said U.S. firms would move aggressively into China, bringing in Western talent -- including country crooner Garth Brooks very soon -- and fostering local talent.
Beijing's concession allowing Hollywood and U.S. music publishers to tap China's vast but impenetrable market was one of two keys to the anti-piracy pact, the other being raids on plants making counterfeit compact discs.
But at a morning news conference, Wu said angrily that market access should never have been part of the talks and set a tone of confrontation for her talks with Kantor.
She said that a Chinese proverb -- "courtesy demands reciprocity" -- mandated a rude and perhaps retaliatory reply by China to what she called a broken U.S. vow to help China re-enter the General Agreement on Tariffs and Trade.
Washington pledged in a 1992 memorandum of understanding on market access in China to "staunchly support" Beijing's return to GATT, but last year acted to block its accession -- a move Wu branded "very regrettable".
"Now that the U.S. side has not seriously implemented its commitment in the MOU (memorandum of understanding), the Chinese side is entitled to express its displeasure," said Wu, whose tough diplomacy has made her China's most powerful woman. "The Chinese side is also entitled to take corresponding action."
She did not say what reprisals she had in mind.
The U.S. action dashed China's hopes of being a founder member of the World Trade Organization, which replaced GATT on Jan.1.
Kantor said it appeared China had halted implementation of the 1992 MOU, which obliged it to remove barriers to hundreds of imports, and said WTO membership was a problem "as long as China threatens to suspend" the market-access pact.
He said the U.S. Trade Law soon would force him to order countermeasures but declined to specify what China could do to avert such action.
Kantor said China's WTO entry was also threatened by its "pillar industry" policy in which it protects and subsidises carmaking, telecommunications and other key sectors.
Citing China's export muscle and growing trade surpluses, Kantor has baulked at Beijing's bid to join GATT and the WTO as a developing economy meriting exemptions from stricter trade rules imposed on developed countries.
China responded by walking away from the GATT talks, calling the World Trade Organization a misnomer for excluding a major trade power with a fifth of the world's population.
More recently, however, Beijing has signaled a desire to resume its bid -- and has made clear that its WTO ambitions would be the focus of Wu Yi's talks with Kantor.