"U.S.-China economic ties have expanded substantially over the past several years. Total U.S.-China trade, which totaled only $5 billion in 1980, rose to $343 billion in 2006. China is also now the 2nd largest U.S. trading partner, its 2nd largest source of U.S. imports, and its 4th largest export market. With a huge population and a rapidly expanding economy, China is a potentially huge market for U.S. exporters. […] Although China has enacted a number of strict IPR [intellectual property rights] laws and regulations, U.S. firms charge that enforcement is lax and ineffective and costs U.S. firms billions of dollars in lost sales annually. Another U.S. concern is over China's use of industrial policies that attempt to promote the development of domestic firms at the expense of foreign companies. On March 30, 2006, the United States initiated a WTO [World Trade Organization] case against China over its discriminatory tax treatment of imported auto parts, and on February 5, 2007, it initiated a WTO case regarding various Chinese subsidy policies. Several bills have been introduced in Congress to address Chinese economic policies deemed harmful to U.S. economic interests, including China's currency policy. In response to growing congressional concerns over these issues, on December 14-15, 2006, the Bush Administration held its first round of talks with China under the 'Strategic Economic Dialogue' (SED), a high-level government forum established to discuss major long-term economic issues, including China's currency policy and its protection of IPR [intellectual property rights]. This report examines major U.S.-China trade issues and will be updated as events warrant."
CRS Report for Congress, RL33536