
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SUNDAY, January 1, 1995                   TAG: 9501030079
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-14   EDITION: HOLIDAY 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

FROM TRUFFLES TO TOYS, CHINESE GOODS FACE HUGE TARIFFS

Moving to stop what it called ``rampant piracy'' of American computer software, movies and music, the Clinton administration Saturday targeted $2.8 billion of Chinese goods for possible trade sanctions.

The United States listed 23 categories of Chinese products for possible punitive tariffs of 100 percent. The categories cover a wide range of goods, including such things as truffles, athletic shoes, toys, sporting goods, watches and suitcases.

The battle represented only the most recent in a series of acrimonious trade disputes between the two countries as the administration has struggled to find ways to narrow an expected $29 billion record trade deficit with China this year, second only to the trade gap with Japan.

Chinese officials reacted swiftly, saying that if the United States carried through with its threatened sanctions, China would have no choice but to retaliate against American companies, raising the prospects of a full-fledged trade war.

Chinese officials charged Saturday that the United States was making unreasonable demands and ignoring the progress China has made in increasing copyright enforcement.

``Though there still exist copyright thefts - and some cases are quite serious - the Chinese government's stand for fighting piracy is clear, and our practice is fruitful,'' a spokesman for the State Copyright Administration said.

The official Xinhua News Agency quoted the Ministry of Foreign Trade as saying China's retaliation would include breaking off negotiations with U.S. companies seeking to set up auto, chemical and pharmaceutical operations in China; suspending imports of American films, TV programs and laser discs; and raising tariffs to 100 percent on imports of U.S.-made cassette tapes, compact discs, cigarettes, alcoholic beverages and cosmetics.

In announcing the administration action, U.S. Trade Representative Mickey Kantor said the United States, which accounts for 40 percent of China's overseas sales, would not be dissuaded by such threats.

``American companies are suffering tremendous losses annually to piracy in China. This cannot continue,'' he said. ``It is critical that China demonstrate resolve to eradicate rampant piracy.''

Kantor estimated that U.S. companies were losing close to $1 billion a year in theft of copyrighted products. He said that close to 100 percent of videotapes and 94 percent of computer programs sold in China had been pirated.

Electronic products represented the biggest category in the U.S. target list at nearly $1 billion for such items as telephones and radios, followed by furniture imports at $600 million in the past year.

The threatened U.S. sanctions will not take effect until after a 30-day comment period during which the public may argue for or against restricting certain items. Also during this time period, the United States and China will seek to resolve the dispute short of sanctions.

by CNB