ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Thursday, May 16, 1996 TAG: 9605160154
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
DATELINE: WASHINGTON
SOURCE: ASSOCIATED PRESS
U.S. SANCTIONS would not take effect before June 17, but both the United States and China are taking tough positions.
In an increasingly bitter fight with China over copyright piracy, the Clinton administration targeted $3 billion in Chinese clothing and consumer electronic goods for punitive tariffs Wednesday. They would be the largest trade-sanctions package in U.S. history.
The Chinese responded immediately with a sanctions list of their own, and the possibility of a full-fledged trade war threatened to aggravate already serious strains between the two governments.
The range of items on the U.S. target list encompasses silk blouses and cotton underwear, cellular telephones, fax machines and bicycles, swimwear, coffee makers and cigar boxes.
Announcing the list, acting U.S. Trade Representative Charlene Barshefsky insisted the administration had no choice but to apply economic pressure in light of China's failure to honor a 1995 agreement to halt widespread piracy of American computer programs, films and music.
``We do not take the move toward retaliation lightly,'' she said. ``But when other countries do not live up to their trade agreements with the United States, we will take action.''
Minutes after the announcement, the Chinese announced a list of proposed economic sanctions that would target a whole range of American farm products: cotton, frozen beef, chicken, vegetable oils.
In addition, they said they would suspend imports of American movies, television programs and music and stop processing applications from U.S. chemical, pharmaceutical and other companies seeking to set up joint ventures in China.
The threat and counterthreat represented a replay of last year's battle that resulted in $1.08 billion in U.S. sanctions being averted at the last minute when the Chinese promised to wage an intensive crackdown on more than 30 factories producing millions of pirated products.
This time, both sides appeared at least initially to be staking out hard positions. The United States is demanding concrete action to satisfy the 1995 agreement, and the Chinese are insisting that Washington is setting unreasonable time limits for full compliance.
``With a view to safeguarding state sovereignty and national dignity, China shall have no other options but [to] take corresponding counterretaliation measures,'' the Ministry of Foreign Trade and Economic Cooperation said in a statement distributed by China's official news agency.
The U.S. sanctions will not take effect before June 17 to allow a month for comments in which both countries will be able to negotiate further.
To lessen the economic pinch on American consumers, Barshefsky said, the administration sought to target products that also are produced in the United States or in foreign countries other than China.
The U.S. Association of Importers of Textiles and Apparel disputed that assertion. It contended the proposed sanctions' impact would be as a ``monstrous tax increase for the American public and a devastating blow to America's retailers.''
The biggest item on the U.S. sanctions list is $750 million in Chinese silk clothing. The United States produces no silk, and China represents 70 percent of American imports. Almost all the rest come from Thailand, India and other Asian nations.
In addition, the list includes $555 million in clothing from man-made fibers, $470 million in cotton products and $204 million in other textile fibers.
LENGTH: Medium: 75 lines ILLUSTRATION: PHOTO: AP 1. Pirate copies of U.S.-made videotapes and CDsby CNBare at the heart of the trade controversy. 2. chart by staff. color.