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WTO: China should reconsider currency plan
(Reuters)
Updated: 2006-03-17 19:17
Senators Charles Schumer, a New York Democrat, and Lindsay Graham, a South
Carolina Republican, are sponsoring legislation that would impose
across-the-board penalty tariffs of 27.5 percent on Chinese goods unless the
Chinese stop the practice.
Congress could take "extreme action" if Beijing does not move soon toward
economic reform, Graham told a congressional advisory panel Thursday.
The administration of U.S. President George W. Bush also has been stepping up
the heat on China over intellectual property rights. U.S. officials say rampant
Chinese copying of movies, music, software and other goods costs legitimate
products worldwide up to US$50 billion (euro41 billion) annually in lost
potential sales.
Last month, U.S. Trade Representative Rob Portman (news, bio, voting record)
announced the creation of a new China enforcement task force in his office and
indicated that without progress soon on piracy, as well as high Chinese tariffs
imposed on American auto parts, the administration would probably file unfair
trade cases against China before the WTO.
The Geneva-based trade organization said "effective enforcement of
intellectual property rights is also needed to ensure an investment environment
conducive to the development of an innovative private sector and foreign
investment."
"Steps have been taken to ensure better enforcement and coordination between
the various government agencies involved in enforcement," the WTO said. However,
China's relatively low fines and lenient penalties "appear insufficient to deter
(intellectual property rights) violations."
The summary did not address Chinese policy on automotive parts specifically,
but said Chinese manufacturing has boomed partly as a result of government
assistance and public investment.
"The result is that manufacturing, especially export-oriented manufacturing,
has developed more rapidly than other sectors," the WTO said.
The European Union also has moved recently to counter what it calls unfair
trade practices by China. On Thursday, the 25-nation EU announced it would soon
slap duties on Chinese and Vietnamese shoes, acting against a flood of cheap
imports that it says breaks world trade rules.
Four majority state-owned banks hold 54 percent of banking assets in the
country and insurance is dominated by six state holding companies accounting for
85 percent of all premiums, the WTO noted.
In telecommunications, six majority state-owned companies dominate basic
services, even if private firms are largely responsible for value-added
services. Air and maritime transport services are similarly controlled by
majority or fully state-owned enterprises, WTO said.
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