Business in China could become "too risky" for US firms without changes to the regulatory environment, Commerce Secretary Gina Raimondo warned Wednesday as she wrapped up a visit to the world's second-largest economy.
Speaking on her fourth day in China and after several rounds of talks with officials as well as with US firms, Raimondo said she had raised "tough issues" with local counterparts.
The business environment in China "has to be predictable, there has to be a level playing field, there has to be due process, there has to be transparency", she told a press conference near Shanghai.
"US business needs to see some action taken to address these issues, otherwise they will deem it as too risky," she said.
Raimondo is the latest in a series of senior US officials to visit Beijing, as both sides seek to defuse tensions across a range of security and economic issues that have been at their highest levels in years.
"I raised the tough issues like subsidies, like China's non-market practices, like raids on US firms, like intellectual property theft," Raimondo said.
She also said she had raised the alleged hacking of her email by China-based actors with Beijing officials.
"I mentioned that as an example of an action that erodes trust at a time when we are trying to stabilise the relationship," she told a digital press briefing following the media availability in Shanghai.
But this week's talks were "productive", she added, and an "excellent start".
"Nothing good comes from shutting down communication," she said.
US firms in China have long complained about what they see as an unfair business environment, with limited protection for intellectual property and preferential treatment afforded to domestic competitors.
Those fears have been compounded this year by a broad crackdown on US consulting firms operating in China.
A new anti-espionage law, which came into force on July 1, has also spooked foreign and domestic firms as they try to decipher authorities' intentions and, crucially, pinpoint what is off-limits.
- 'Most consequential' -
Raimondo has used the trip to seek more open discussions with the Chinese over trade curbs and the two sides have agreed to set up a working group to iron out the laundry list of trade disputes between them.
They also agreed to establish what Washington called an "export control enforcement information exchange" -- described as a platform to "reduce misunderstanding of US national security policies".
That group held its first meeting on Tuesday, Raimondo said.
"It was an open dialogue," she said.
"We were able to clarify in the first meeting that we're not targeting China," she added.
"We're targeting certain behaviour. We're targeting actions and behaviour which undermine US national security."
Raimondo has repeatedly stressed this week that US curbs on Chinese businesses -- which Washington says are aimed at protecting its national security -- need not affect the broader economic relationship.
Chinese officials have pushed back, with Premier Li Qiang telling Raimondo Tuesday that US moves to "politicise" trade issues would prove "disastrous" for the global economy.
"Politicizing economic and trade issues and overstretching the concept of security will... seriously affect bilateral relations and mutual trust," Li told Ra
imondo, according to China's official Xinhua news agency.
On Wednesday, Raimondo told Shanghai Communist Party chief Chen Jining that the US-China economic relationship was "among the most consequential in the world".
Later, she met with students at New York University's campus in Shanghai and spoke at a meeting of women executives hosted by the American Chamber of Commerce in the city.
Artificial Intelligence Analysis
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Analyst Summary
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This article discusses the potential risks associated with US firms doing business in China. Commerce Secretary Gina Raimondo warned that without changes to the regulatory environment, US firms may deem it as too risky to conduct business in the country. During her visit to China, she raised tough issues with local counterparts such as subsidies, non-market practices, raids on US firms, and intellectual property theft. Raimondo also mentioned the alleged hacking of her email by China-based actors during the talks. US firms in China have long expressed concerns about the lack of protection for intellectual property and the preferential treatment given to domestic competitors. Despite these risks, the talks were productive and a good start in establishing a more stable relationship between the two countries.
The article references significant events and trends in the space and defense industry over the past 25 years. In the 90s, China joined the WTO, which allowed foreign companies to access Chinas markets and establish factories in the country. This facilitated the development of strong economic ties between the US and China. In recent years, however, tensions have risen due to Chinas increasingly aggressive economic policies, such as subsidies, non-market practices, and intellectual property theft. This has led to an increasing risk for US firms doing business in China.
Investigative
Question:
- 1. What specific steps are the US and China taking to reduce the risks associated with US firms doing business in the country?
- 2. How is the US government protecting US firms from potential raids, intellectual property theft, and other non-market practices?
- 3.
What steps can US firms take to protect their intellectual property rights in China? 4. What specific actions has the US taken to punish China for alleged hacking of US officials emails?
5. How have other countries responded to the increased risk of doing business in China?
This AI report is generated by a sophisticated prompt to a ChatGPT API. Our editors clean text for presentation, but preserve AI thought for our collective observation. Please comment and ask questions about AI use by Spacedaily. We appreciate your support and contribution to better trade news.
