China’s ‘Indigenous Innovation’ Could Harm U.S. Exporters

By May 11, 2010Innovation, Trade

The National Association of Manufacturers is one of 22 business groups to join in comments objecting to a proposed rule from the China’s Ministry of Science and Technology meant to enact the government’s  “indigenous innovation” initiative that would give advantages to Chinese company’s over foreign competitors.

From the comment letter:

While we support and encourage innovation in China, and look forward to working with the Chinese Government to promote an environment that enhances opportunities for innovation in China, we believe that the Draft Notice and the many related policies would actually decrease, not increase, innovation in China. These related policies, broadly linked to indigenous innovation, limit the types of products that are developed and used in China and exclude some of the most innovative suppliers, the associated R&D, and resulting innovation benefits to the Chinese market.

National Journal’s Tech Daily Dose reported on the comments in “Firms Urge China To Repeal Indigenous Innovation Policy.”

[The groups] also voiced concern with other Chinese policies that they say encourage or mandate procurement from Chinese suppliers; extend monetary or other benefits only to Chinese suppliers; and “provide preferences to products including ‘Chinese’ IP, or compel the transfer of or otherwise fail to adequately protect IP in non-Chinese products.”

The groups also questioned whether such policies are in compliance with China’s international trade obligations and pledges not to discriminate against foreign firms in its procurement policies.

Reuters, “U.S. to press China on innovation policy at meeting

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