At the end of this week, the torturously drawn-out saga of US-China trade talks – the outcome of which may very well decide whether the world economy slips into recession or stabilizes – will continue in Beijing.
US Trade Representative Robert Lighthizer will travel with his sidekick in the negotiations, Treasury Secretary Steven Mnuchin, to meet with Chinese counterparts and try to make a deal that both countries’ leaders by all accounts need.
From a domestic political standpoint, both US President Donald Trump and Chinese President Xi Jinping have every reason to shore up their respective economies as global markets flash warning lights.
But in an interview on Monday, Lighthizer did nothing to clear up demands that have confounded Beijing, including on the issue of alleged forced technology transfer.
When asked by NPR’s Ailsa Chang whether a satisfactory solution would be for the Chinese government to prohibit any business deal under which US companies agree in the light of day to hand over certain technology in exchange for market access, Lighthizer gave a confusing answer.
“So you’re kind of conflating two things, I think. In the one case, it’s forced technology transfer. All right. In another case, you’re saying, well, there may be a business situation where it makes sense to do something like that. If you’re forced to do it, it’s inappropriate. If you’re cajoled into it, it’s still bad. But I’m not saying in all cases you shouldn’t be able to enter into a business arrangement.”
His equivocal answer, which acknowledges that the practice of asking foreign firms to agree to handover technology is not necessarily wrong, illustrates the difficulty in creating a fix for the alleged problem.
Lighthizer suggests in the interview that an enforcement mechanism could allow companies to bring a complaint to him, then he would get in touch with his contacts in Beijing, and then they would crack down on the unacceptable behavior.
“They’re committed to do this, but it’s going to be a question of whether they can get all the layers of government, I think, to follow through,” he said.
Lighthizer ended the interview on a somewhat optimistic note, that in his view many on the Chinese side think that reforms the US is asking for are helpful for China.
“I think you have to start with the proposition that there are people in China who believe that reform is a good idea. And you have to believe that those people are at a very senior level.… So the kinds of things that we’re asking for are not anti-Chinese at all. Protection of intellectual property is not anti-Chinese. Stopping people from forcing transfer of technology is not anti-Chinese. In fact, the reformers would say it’s pro-Chinese. It will help their economy, not hurt their economy.”