President Donald Trump has slapped tariffs on $50 billion worth of Chinese goods, taking aim at China’s theft of US intellectual property.
The United States has long said that intellectual property theft has cost the US economy billions of dollars in revenue and thousands of jobs.
The United States Trade Representative, which led the seven-month investigation into China’s intellectual property theft and made recommendations to the Trump administration, found that “Chinese theft of American IP currently costs between $225 billion and $600 billion annually.”
Those numbers are in line with a 2017 report from the Commission on the Theft of American Intellectual Property.
Chinese officials have said that protecting foreign companies’ intellectual property rights is important to China.
But many of its companies appear to have missed that memo.
“China has sought to acquire US technology by any means, licit or illicit,” James Andrew Lewis, senior vice president at the Center for Strategic and International Studies in Washington, wrote in a blog post Thursday.
“Espionage and theft were part of this, but so were forced technology transfers or mandatory joint ventures as a condition for doing business in China,” he wrote.
One of the most recent high profile examples of theft of US intellectual property happened earlier this year. In January, a Beijing-based wind turbine company was found guilty in the US of stealing trade secrets, using secretly downloaded source code stolen from a Massachusetts company.
Forced technology transfer is also a growing concern for US companies, especially tech firms.
To get an idea of how much forced technology transfer costs the US, some experts say to look at the costs associated with the theft of trade secrets. Total theft of US trade secrets accounts for anywhere from $180 billion to $540 billion per year, according to the Commission on the Theft of American Intellectual Property — as “the world’s principal IP infringer,” China accounts for the most of that theft.
Those numbers are likely to go up, as China doubles down on policies that could lead to acquisition of foreign technology and information — like the controversial new cybersecurity law that went into effect last year.
One of the most contentious parts of the law involves measures that allow China to conduct security reviews of technology products and services that could affect national security.
Critics slammed the plans as intrusive and trade-inhibiting, and industry organizations, including the US Chamber of Commerce, say they are concerned over unfair advantages for Chinese companies and trade barriers.
Beijing says the new law is meant to strengthen the protection of personal information and combat online fraud.