US move to break off ITA talks criticized

Washington's requirements are 'too high'

China on Monday accused the United States of being "irresponsible" in suspending negotiations to expand an international agreement on reducing tariffs for a wide range of IT products while Washington criticized China for stalling the talks with a long exemption list.

"The US is irresponsible to discard the consensus reached by most of the countries only because the deal did not meet its own requirement for several products. This disregards the efforts of all the negotiation participants, including China," Commerce Minister Gao Hucheng said on Monday in a statement posted on the ministry's website.

On Thursday, the US halted negotiations to expand the Information Technology Agreement. Negotiators from more than 50 countries, accounting for about 97 percent of IT products' global trade, aimed to update the 16-year-old World Trade Organization agreement to cover the Internet era, cutting the import cost of items such as personal computers, laptops, telephones, fax machines, computer software and semiconductors.

US Trade Representative Michael Froman said China's demands to exempt more than 100 products from the technology trade deal could lead to a breakdown in the negotiations.

The talks first halted in July after China decided to exclude more than 100 products from the 256-product list at the center of the negotiations.

The talks resumed in November following China's assurances to negotiators that it was prepared to substantially reduce the number of excluded products.

But China's updated list amounted to only a few minor tweaks rather than significant concessions, the Financial Times reported.

"China has been actively engaging in the ITA talks since September 2012. It not only adjusted domestic industries many times but kept improving its offer during the talks," Gao said in the statement.

"Through China's efforts, the majority of the negotiators reached a consensus covering tax exemptions on about 200 items worth a global trade value of $2.77 trillion," he said.

"The US' abrupt suspension of the negotiations on Thursday not only surprised China but also disappointed all participants with potential benefits from the talks."

Gao added that it is "very normal" for various negotiators to have different claims during the talks because of diverse development levels. But he said the US demands far exceeded what was acceptable to Chinese industries, which "is the prime cause that the negotiations could not reach an agreement".

China acknowledged that the US is unwilling to make concessions owing to pressure from its enterprises with significant competitive advantage. But, the statement said, it is "unacceptable" to China for the US to ignore the appeals from Chinese enterprises in weak positions as well as the huge gap between the two countries.

"It's the US being irresponsible rather than China that should be blamed. All negotiators in the ITA talks have their lists, and they can narrow China's list through negotiations instead of discarding the current outcome," said Sang Baichuan, director of the Institute of International Business at the University of International Business and Economics in Beijing.

"The US made too high requirements for developing countries. Not only China, but also negotiators from other developing economies agreed that developed economies should make more concessions and come up with flexible arrangements and transition periods for developing economies," Sang said.

Yao Weiqun, associate president of the Shanghai WTO Affairs Consultation Center, said China had made "arduous efforts, and it is never easy to adjust domestic industries involved in the talks".

"The US has competitive advantage in information and communication technology products and wants to expand its business presence in China. But these products relate to China's strategic emerging industries, and China expects more room for industrial development," Yao said.

China is the world's leading exporter of and market for IT products.

The Financial Times quoted John Neuffer, senior vice-president for global policy at the Information Technology Industry Council, as saying that "China has got to be part of this. They are too big a player. You can't have an outcome without the Chinese."

"China does not think the talks are ended. All sides should head for the right direction to find a proper solution and reach an agreement as soon as possible," Gao said in the statement.