Trump to Announce China Trade Practices Investigation

Elias Hubbard
August 13, 2017

The trade investigation could strain relations between the USA and China as the two countries wrestle with the unpredictable situation over North Korea. The Trump administration was expected to move directly into the investigation, so the memorandum reflects the more measured approach the administration also appears to be taking with steel and aluminum.

Section 301 of the Trade Act of 1974, a popular trade tool in the 1980s that has been rarely used in the past decade, allows the president to unilaterally impose tariffs or other trade restrictions to protect USA industries from "unfair trade practices" of foreign countries.

"China's unfair trade practices and industrial policies, including forced technology transfer and intellectual property theft, harm the USA economy and workers", a second official told reporters.

Despite Mr. Trump's promises to be tougher than previous presidents on trade, his administration has proceeded with high levels of caution.

President Donald Trump on Monday will order his top trade adviser to determine whether to investigate Chinese trade practices that force US firms operating in China to turn over intellectual property, senior administration officials said on Saturday.

"I think China can do a lot more", Trump told reporters on Thursday.

The President had been expected to call for a so-called Section 301 investigation under the 1974 Trade Act earlier this month, but action was postponed as the White House tried to work with China to rein in North Korea's nuclear program.

It's unclear whether any actual repercussions for China, like sanctions or tariffs, would come from an investigation like this, and officials said there is no timeline for how long an investigation would take.

CNN also reported that Trump told Chinese President Xi Jinping about the expected executive action in a phone call on Friday.

If the investigation finds evidence of wrongdoing, Mr. Trump could retaliate against China with tariffs or other punitive measures that have yet to be determined.

"President Trump and President Xi agreed North Korea must stop its provocative and escalatory behaviour", the White House said in a statement. They added that the trade measure would be carried out under the rules of worldwide law and would not trigger greater conflict with China. They said that US companies had long suffered because of Chinese intellectual property violations, and that they expected Congress and the business community to support the measure.

In addition to the United States, the European Union, Japan, Germany and Canada have all expressed concern about Chinese theft of intellectual property. "Our foolish past leaders have allowed them to make hundreds of billions of dollars a year in trade, yet. they do NOTHING for us with North Korea, just talk". Though widely used worldwide, the WTO process is viewed unfavorably by the Trump administration.

Trade experts and business leaders said the new investigation into intellectual property could be a sign that the trade agenda is shifting into the hands of United States Trade Representative Robert E. Lighthizer, a respected negotiator who helped implement some of the most protectionist trade policies of recent decades during the Reagan administration.

The administration has been eyeing other moves to rebalance the U.S.

Other reports by Click Lancashire

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