Gary Locke — the US Ambassador who buys his own coffee AND flies cattle class — gave an important speech yesterday in which he laid out his vision for the future of the U.S.-China economic and trade relationship. Here are a few excerpts:
[M]y top priority here is to work with the American business community in China to support President Obama’s job-creating efforts:
- Helping to double American exports by 2015 – which will create jobs in the U.S. and provide high-quality, Made-in-America products and services which would be beneficial to China;
- Increasing Chinese investment in the U.S. – which will help Chinese companies prosper while at the same time creating jobs in America;
- And ensuring that U.S. companies can compete on a level playing field in China and operate in the same open and fair environment that Chinese companies enjoy in the U.S.
China’s current business climate is causing growing frustrations among foreign business and government leaders, including my colleagues in Washington. Last week, I was speaking with students at Beijing Foreign Studies University. And I identified what I believed to be the single largest barrier to improved U.S.-China cooperation: A lack of openness in many areas of Chinese society – including many areas of the Chinese economy. And if this continues, it will mean:
- Less innovations from Chinese businesses;
- Fewer opportunities for the Chinese people; and
- Slower growth for the Chinese economy.
This is something neither China nor the global economy can afford.
In the United States, for every $1 in computer hardware sales there is about 88 cents in software sales. But in China, for every dollar in hardware sales there is only eight cents in software sales. According to the Business Software Alliance, that discrepancy is largely explained by the fact that nearly 80 percent of the software used on computers in China is counterfeit. Software companies report that they earn more from legitimate sales of their products in Vietnam than in all of China, despite the fact that China’s economy is more than 50 times larger. The lack of strong intellectual property rights enforcement is troubling not just to foreign firms, but to Chinese innovators as well. I have heard from so many Chinese-owned companies who have devoted significant resources to develop new products and technologies. And they complain they were almost wiped out by others illegally copying their ideas and technology. For every foreign company calling for stronger IP protection, there are many more Chinese companies demanding the same.
And, we are also committed to improving our visa process. We know that if we want to strengthen our commercial relationship with China and create jobs in America, that we need to make it easier for Chinese business people and tourists to travel to the United States for business and leisure. Reducing the wait time to obtain visas to travel to the U.S. will be a top priority for me as Ambassador.
More than five million Americans are directly employed by foreign companies in the United States, ranging from Japanese carmakers to Russian steel plants to Indian energy and industrial companies to Brazilian juice processors. And we’re welcoming more Chinese companies every day, as China’s foreign direct investment in America increased 400 percent between 2008 and 2010.