Isolationism Watch: China Places Restrictions on Foreign-Manufactured Medical Equipment

It isn’t just the U. S. (or, indeed, even mainly the U. S. ) that is taking protectionist stances these days. The Chinese government has placed burdensome safety regulations on foreign-made medical equipment that do not apply to the same sorts of products made in China:

WASHINGTON, Nov. 15 — Few American industries have had more success in selling goods to China than makers of medical devices like X-rays, pacemakers and patient monitors. Which is why a recent Chinese decree was so troubling.

The directive, issued in June, called for burdensome new safety inspections for foreign-made medical devices — but not for those made in China. The Bush administration is crying foul.

Even more worrisome to the administration is that the directive seems part of a recent pattern in which Chinese officials issue new regulations aimed at favoring Chinese industries over foreign competitors, despite efforts by Treasury Secretary Henry M. Paulson Jr. to ease economic tensions.

“There is clearly a growing economic nationalism in China that is leading to discrimination against foreign investors in pillar sectors of the economy,” said Myron Brilliant, vice president for Asia at the United States Chamber of Commerce. “It’s not only a threat to foreign investors but it also undermines China’s transition to a market-based economy.”

I suspect that there’s rather less to this story than meets the eye and that, if we were to investigate the story fully, we’d find that some party official or one of his relatives somewhere is in the medical equipment business. This results in what we see in China, namely that the country runs a net trade surplus with the rest of the world and has an absolute trade surplus with nearly every country in the world. China has what is effectively a one-way autarky. There are so many Chinese party officials who have interests in so many industries!

Nonetheless I can’t think of anything more likely to provoke the Congress into putting restrictions on Chinese imports than an action of this sort. Conversely, how is the U. S. to make things that people in other countries want if the countries in which these people live throw up barriers against the things that people want?

Hat tip: memeorandum

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