The Obama administration should reassess its China policy in light of Beijing's aggressive efforts to modernize its military and achieve global economic dominance, a congressional advisory panel said Wednesday.
The U.S.-China Economic and Security Review Commission, in its annual report, said Congress should pass legislation requiring the White House to carry out a "comprehensive review of U.S. economic and security policies toward China."
The review should determine what policy changes are needed "to address the increasingly complicated and serious challenges posed by China to U.S. international and domestic interests," the 414-page report says.
The commission also recommended that Congress mandate or carry out several smaller, more-specific reviews, including assessing whether the U.S. military could wage a major war if its sophisticated global command, surveillance and reconnaissance systems were damaged or destroyed by Chinese space-weapons or cyber-attacks.
The commission singled out trade and exchange rates, innovation and intellectual property, and capital markets as three areas where policy changes were needed.
On trade, the commission recommended a more aggressive use by U.S. officials of World Trade Organization rules against anti-competitive practices. The panel also accused Beijing of requiring foreign companies wanting to do business there to form joint ventures or file for Chinese patents, thus giving China access to their technology.
Congressional auditors should investigate whether federally supported research and development work was being transferred to China by U.S. companies, the commission proposed.
"China is actively seeking to exploit the United States' military vulnerabilities as the U.S. government fails to stop the theft and voluntary forfeiture of American technology to Chinese state-owned companies," said Rep. J. Randy Forbes, Virginia Republican and co-chairman of the Congressional China Caucus.
Wang Baodong, a spokesman for the Chinese Embassy in Washington, said China would "urge the Commission to take a rational approach towards China and stop issuing such politicized reports that are full of twisted facts and unwarranted allegation."
"We strongly believe China's trade and financial policies are in line with the international rules and China's obligations, and that they're productive for both China itself and the rest of the world, including the United States," he said.
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