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How will China respond to WTO ruling?

Nancy Marshall-Genzer Dec 22, 2009

How will China respond to WTO ruling?

Nancy Marshall-Genzer Dec 22, 2009


Bob Moon: Much of Hollywood’s focus this week has been on a ruling from the World Trade Organization. The U.S. has hailed it as a major victory for America’s cultural exports. It’s supposed to open up the vast Chinese market to foreign films, music and books. But exactly what the Chinese must do to comply is still fuzzy. Marketplace’s Nancy Marshall Genzer reports on how China might respond to the ruling.

NANCY MARSHALL GENZER: The movie “Avatar” opened in Beijing this week.

But before it could wow Chinese audiences with its special effects, the blockbuster had to bust through a number of trade barriers. China requires foreign films and books to be imported and distributed by Chinese companies. Music publishers need Chinese partners. China says it’s to protect public morals.

Greg Frazier is executive vice president of the Motion Picture Association of America.

GREG FRAZIER: What we want is the ability to do business in China the same way that business is done virtually every other place in the world.

China is expected to find some way to comply. And if it doesn’t? The U.S. can retaliate by raising tariffs on Chinese exports.

Robert Scott is an international economist at the Economic Policy Institute.

ROBERT SCOTT: Perhaps a third of all of China’s GDP comes from exports and the United States is its number one export customer.

But U.S. companies still face a huge problem. Cheap, pirated versions of their products are sold all over China. Does that make the WTO ruling moot?

Not according to Erin Ennis of the U.S. China Business Council. She says U.S. filmmakers can compete on quality. Their DVDs are much better than pirated versions shot in theaters.

ERIN ENNIS: Not the DVD of a movie that has somebody’s head when they got up to go to the bathroom.

Ennis says the Chinese might just pay a little extra for the real thing.

In Washington, I’m Nancy Marshall Genzer for Marketplace.

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