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US investigation won’t harm China’s high-tech industries: officials

US fears China will overtake it in high-tech fields: expert

The US' Section 301 investigation won't harm China's high-tech and advanced manufacturing industries, and China can easily cope with any challenge in the field of intellectual property rights (IPRs), Chinese experts and officials said. "China's achievements in innovation were made not through stealing or plundering, but based on the efforts of the Chinese people," Zhang Zhicheng, head of the department of IPR protection and coordination affairs under the State Intellectual Property Office (SIPO), was quoted by Xinhua News Agency as saying on Sunday.

The claims of the US Section 301 investigation on China's technology transfers and innovations are groundless, he said. Zhang's comments came after the Office of the US Trade Representative (USTR) on Tuesday published a proposed list of Chinese goods subject to an additional 25 percent tariff. The list is based on a so-called Section 301 investigation into alleged Chinese intellectual property and technology transfer practices, Xinhua reported.

Section 301 tariffs mainly focus on Chinese industries which benefit from Made in China 2025, Beijing's industrial development plan, and exposes the US' aim of deterring China from becoming an economic and technology superpower, Zhao Ying, a researcher at the Chinese Academy of Social Sciences' Institute of Industrial Economics, told the Global Times.

The US is worried that once China develops mature technologies and advanced manufacturing capacities in certain fields, it will directly compete with the high-tech industries of the US, and threaten or even surpass it, said Bai Ming, deputy director of the Ministry of Commerce's International Market Research Institute.

To justify the tariffs, the USTR said in its report that "foreign technology acquisition through various means remains a prime focus under Made in China 2025 because China is still catching up in many of the areas prioritized for development," Reuters reported.

Progress in China's manufacturing capabilities and international competitiveness is attributed to the country's huge investment in innovation and the competitive advantages of the manufacturing sector, including a sound industrial system and a large number of skilled workers and innovative enterprises, Zhang said.

The Chinese government has no restrictive rules on technology transfers, which is only voluntary on the companies' part, Bai noted.

Moreover, most manufacturing sectors in China have embraced international cooperation and competition, and China has developed a mature mechanism to review fair market competition, he added.

R&D focus

Even if the US slaps tariffs on these industries, China is prepared to face the challenges in IPR, as the country's ability to innovate has greatly improved, its industries have upgraded and it possesses an enormous market, Zhao said.

A recent report issued by the World Intellectual Property Organization said China was the second largest source of international patent applications in 2017 under WIPO's Patent Cooperation Treaty. It is expected to overtake the United States, the largest source, within three years, Chinese Ambassador to Britain Liu Xiaoming said on Thursday while defending China's trade practices, Xinhua said.

To counter the investigation, China may focus more policy and funding support on the research and development of key technologies within the framework of World Trade Organization rules, and step up its effort to invest in research and development institutes, Zhao predicted.

While the US' protectionist policy gives its companies a short-term advantage against outside competition, these firms will be hurt in the long run, he noted.


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