New Year, Same Complaint

Chinese intellectual property theft and forced technology transfer are salient issues as the trade agreement deadline looms.

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Today, China begins a weeklong holiday to mark the beginning of the Year of the Pig. But trade negotiators will find little time to rest, as less than a month remains until a March 1 deadline to reach an agreement before the Trump Administration imposes further tariffs on Chinese goods.

The White House has issued mixed messages about the progress of the talks -- with President Trump saying last week that he was optimistic a deal would be reached, but with his top negotiators reporting little tangible progress. Predata’s US-China Trade War index has risen in the past week, a sign that online observers perceive friction in the negotiations.

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The main driver of the signal is activity on Chinese-language web pages related to Section 301 of the US Trade Act of 1974, which authorizes the president to take broad retaliatory action in instances where a foreign government violates international trade practice or unfairly disadvantages US commerce. The White House has alleged China’s theft of US intellectual property and forced technology transfer constitute such violations, and one of its demands in the talks is that China abandon these practices.

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Beijing is unlikely to do that. And the increased attention to the issue among Chinese trade watchers may reflect high expectations that negotiators will be unable to solve the issue. That could mean a harsh resumption of the trade war is on the horizon.