Trade Tensions With China Shadow G-20 Meeting

(New York Times – Sewell Chan)

Anger toward China’s currency, trade and industrial policies has been steadily mounting in Congress, adding pressure on President Obama to take a tough stance with his Chinese counterparts at the Group of 20 leaders’ meeting next week in Toronto.

On Wednesday, the House Ways and Means Committee heard from business leaders alarmed about an initiative under which Chinese government agencies would procure high-tech products – including telecommunications, software and energy-saving equipment – only from companies that use technologies developed in China.

Last week, several software executives, including Microsoft’s chief executive, Steven A. Ballmer, visited Washington to complain about technological piracy by Chinese companies. And on Tuesday and Wednesday, the United States International Trade Commission, a federal agency that investigates trade matters, held hearings on enforcement of patents and other forms of intellectual property rights in China.

The mounting tensions could spill over into new retaliatory import duties or other trade barriers, at a time when the United States has several unresolved cases against China before the World Trade Organization, which China joined in 2001. They also reflect growing skepticism about the feasibility of the Obama administration’s stated goal of doubling American exports in five years. Read more here.

Related: China Warns Finger-Pointing Could Derail G20 (Reuters)