Washington, May 16 (RFE/RL) -- The developing U.S.-China trade war over
intellectual property piracy, with projected 100 percent tariffs on many
of each others imports, could be good news for most of the nations of the
former Soviet Union.
The bulk of the U.S. tariffs to be imposed on Chinese imports next
month are on textiles and apparel, products for which China has been
the largest single supplier to American markets. With an effective
doubling in prices of the Chinese goods, American importers are going
to be looking for other sources and countries. Russia, Moldova, Tajikistan,
and Kazakhstan could be among major benefactors.
Ironically, Ukraine, the former Soviet republic with one of the larger
shares of textile and apparel business with the U.S. can't really
benefit from the windfall because its exports to America are limited
by a bilateral agreement on clothes and cloth.
Similarly, the nations of Central and Eastern Europe -- Bulgaria, the
Czech Republic, Hungary, Poland, Romania, and the Slovak Republic -- are
prevented by textile quota agreements from shipping any additional clothes
or textiles into the U.S.
The fact that most of the countries of the former U.S.S.R. -- and a number
of other nations, such as Mexico, Canada, and those in the Caribbean Islands -- are
not covered by textile quotas means they can quickly fill the demands
of the American market.
Acting U.S. Trade Representative Charlene Barshefsky said that in
announcing the proposed tariff increases, the products selected were
designed "to minimize the adverse impact on U.S. consumers" because
other suppliers are readily available.
Russia's exports of textiles into the U.S. market have been rising rapidly
in the last two years, exceeding 76 million dollars in the first nine months
of last year alone. Ukraine's textile sales to the U.S. in the same period
exceeded 57 million dollars.
Belarus has also become a large supplier to the American market, selling
nearly 12 million dollars worth of textiles and clothing articles in the
first three-quarters of 1995.
Moldova has started to sell more textiles to the U.S. as well, exceeding
3.5 million dollars worth from January to September of last year, three
times more than it sold to the U.S. in all of 1994.
Other former Soviet states that began increasing their sales of textiles
and apparel to the U.S. in the first nine months of 1995 include: Armenia,
254,000 dollars; Azerbaijan, 225,000 dollars; Kazakhstan, 1.5 million dollars;
Kyrgyzstan, 59,000 dollars; Tajikistan, 5.3 million dollars; Turkmenistan,
250,000 dollars; and Uzbekistan, 364,000 dollars.
While China's sales to the U.S. in the general category of textiles and
apparel exceeded 4,000 million dollars in the first nine months of 1995,
not all of those items are included in the proposed tariffs.
Barshefsky says about 2,000 million dollars worth of textiles and apparels
are included in the preliminary list released Wednesday. In addition the
list includes 500 million dollars worth of consumer electronics and 500
million dollars in consumer goods, such as decorative wood boxes, cardboard
cartons, jewelry, and steel wool pot-scrubbing pads.
After comments from affected businesses and interested consumers, the list
will be pared to a total of about 2,000 million dollars and will take effect
June 17th. The 2,000 million dollar figure represents what the U.S. believes
that Chinese piracy costs American owners and producers of intellectual
property items, such as music CDs, films, computer programs and records.
Industry groups broadly applauded the U.S. move.
The President of the
Interactive Digital Software Association, Douglas Lowenstein, said
the piracy hurts far more than just U.S. producers of creative products.
He says that "about half the illegal production of entertainment (computer)
software in China is exported," so the U.S. action is "about protecting
legitimate markets" in nations such as "Russia, which are increasingly
endangered due to illegitimate software production in China."
The U.S. Motion Picture Association said it strongly supported the move
because since the 1995 China-U.S. agreement to end the piracy, the "illegal
production of Video Compact Discs (VCDs) in China has actually increased,
with thousands of these illegal productions" going around the world.
The U.S. Business Software Alliance said American computer software
developers and producers are losing hundreds of millions of dollars in
sales globally because of the piracy. In fact, says the association, in
China, "only one computer program in 50 is legal."
The British and Canadian music industry associations joined in supporting
the American action. The U.S. Association of Importers of Textiles and Apparel,
however, called the action "incredible" and "illegal." Association Executive
Director Laura Jones said China was "absolutely irreplaceable as a supplier
for low-income consumers" in the U.S. and that the retaliatory tariffs are
"outrageous and hypocritical."
Barshefsky emphasized that the U.S. did not act precipitously. "We do not
take the move to retaliation lightly," she told a press conference. "But
when other countries do not live up to their trade agreements with the United
States, we will take action."