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The Dragon Bites Back

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    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 favouring 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.

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    The Chinese actions and the administration’s concerns threaten to roil the atmosphere when Paulson goes to China in early December with other cabinet members in another round of the “strategic economic dialogue” that he began in September 2006. After seeking to defuse lingering trade disputes with China for the last 15 months, Paulson instead may have to tamp down fresh outbreaks.

    Administration officials say the recent furore over the safety of Chinese food, toys, toothpaste and other products has taken its toll in the economic relationship, and they hope Paulson’s visit in December coincides with some new agreements to improve safety standards in both countries.

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