Thursday, Apr. 12, 2007 By BILL POWELL
Zhou Fukuan, a cheerful 32-year-old who runs the DVD stand across the street from my old Shanghai apartment, just smiles when I tell him that the U.S. has filed a complaint with the World Trade Organization (WTO) over China's rampant infringement of intellectual-property rights. "I hadn't heard that," he says, "but this sort of thing happens a lot—the government says they'll crack down on [piracy]. It usually lasts a few days, and then ..."
He doesn't need to finish the sentence. And then ... nothing. China is always promising to crack down on intellectual-property abuse. In fact, the government recently declared March 15 to be Antipiracy Day, and there are still big billboards downtown urging everyone to combat the scourge of illegally copied software, DVDs and other products. Not surprisingly, Chinese officials threw a rhetorical fit on hearing of the WTO complaint, brought by U.S. Trade Representative Susan Schwab on behalf of the American music and film industries. Commerce Ministry spokesman Wang Xinpei said it would "seriously undermine the cooperative relations the two nations have established."
In protecting computer software and pharmaceuticals, the Chinese actually have made some progress. That's why companies like Microsoft and Merck want no part of the WTO complaint. But for the film and music business, the claim that there has been headway is simply a joke. "Competition has never been tougher," Li Haihua tells me as he peddles DVDs of new Hollywood films for 60¢ apiece on Shanghai's Huaihai Street, just blocks from a big antipiracy billboard. "There are more [sellers] than ever before, and the price has come down." Zhou says he earns less than 13¢ per disc. "It's definitely a volume business," he adds wearily.
Then again, China is a volume business, one that is increasingly running afoul of Washington as the U.S. trade deficit with the mainland soars. The Bush Administration in February filed another WTO case alleging that Beijing unfairly subsidizes a range of industries; last month the Commerce Department backed a push for higher tariffs on some Chinese paper products. With Congress now controlled by Democrats increasingly skeptical of unfettered global commerce, what was once unthinkable—a trade war with China—has now become remotely plausible. Economists are shuddering, given how harmful a series of tit-for-tat moves between Beijing and Washington could be to the global economy.
China could, in theory, get tough on piracy—not by going after the street vendors, but by shutting down the small, makeshift factories that churn out the discs. There are periodic raids, to be sure, but it would take a lot more effort to truly end the practice, and it's hard to believe the Chinese leadership really cares that much. Maybe a WTO case will change that, but Zhou, for one, doesn't believe it. "Don't worry, I'll still be here," he says, and with a smile asks if I had seen The Last King of Scotland. "Five renminbi," he says.
MY COMMENTS
The author is right that China should get tough on piracy. As i walk down the streets of China, it is like almost every single stall would sell pirated discs, be it secretly or openly. Although there are so many measures and even campaigns to crackdown on piracy, it seems that the problem is not solved. The root of the problem is not tackled. There have been improvements made after China acceded to WTO as laws and regulations and the intellectual property rights issue have to be transparent and improved. However, China seems to be just tackling the issue for the sake of it and not for China's own interests.I think the problem lies with the local governments that are unwilling to co-operate wuth the central government. The local government's performance was judged by the economic growth and not on like the social services they provide or the amount of problems they have managed to solve. Thus, in concusion, i feel that China should try to encourage the local government to tackle this issue or it will definitely create unhappiness, especially from the west.
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