Patents Concern Is No Excuse to Start a Trade War, China Says

(Bloomberg) -- The U.S. and other nations must not use China’s alleged failure to protect foreign companies’ intellectual property as an excuse to start a trade war, Liu Xiaoming, China’s ambassador to the U.K., said on Tuesday.

China has passed more laws to protect intellectual property rights in the last few years than developed economies have managed over decades, Liu said in an interview in Bloomberg’s London office. He denied that his country had been in the business of stealing ideas and technology from U.S. and European firms.

Access to technology and intellectual property is a key issue for both China and its Western partners, as China’s President Xi Jinping pursues his goal of global leadership in robotics, artificial intelligence and other new industries critical to its economic and military prowess. While the U.S. and Europe disagree on whether to impose protectionist measures -- including higher trade barriers -- on China, there’s more unity on pressing Beijing to open its markets further and to protect proprietary technologies from forced acquisition, or even theft.

Momentum is also growing in the European Union to screen what some countries see as predatory Chinese investment in high-tech sectors.

“I think there is some misunderstanding of what has happened in China,” Liu said. “The important thing is the trend, the direction. I think China has become more open, more transparent, more rule-based, and if the United States based their sanctions on this -- on a lack of progress -- it is totally wrong.”

Liu called on the EU as a whole to stand firm in favor of a globalized economy, and against all forms of protectionism. Concern over intellectual property can be discussed, but “it can’t be used as an excuse for trade protectionism,” he said, adding that China still hopes a trade war can be avoided.

Liu also said Beijing was ready to start “substantial” talks on a post-Brexit trade deal as soon as Britain is. He pointed to strong growth in U.K.-China trade, including a 20 percent increase in British exports to China last year.

He declined to be drawn on the “highly sensitive” subject of whether China would prefer to see the U.K. remain in a customs union with the EU, or to negotiate a new bilateral trade deal. Liu did say that some Chinese businesses are worried about the uncertainty surrounding Brexit.

©2018 Bloomberg L.P.