Trade
U.S., Chinese Presidents Tackle Tech Topics In Talks
     Chinese President Hu Jintao said this week during his visit to Washington that China is taking steps to improve trade with the United States and to protect intellectual property rights. Speaking at the White House with President Bush, Hu urged the United States to ease controls on high-technology exports to China. "The U.S. technology products exported to China ... are quite incompatible with the economic might of the United States," he said. Bush and Hu agreed to "step up" cooperation in countering terrorism, combating the avian flu and responding to natural disasters. Bush said the United States has called on China to "move toward a flexible, market-based exchange rate for its currency," Bush said. And Hu said China is "ready" to expand its market access, increase U.S. imports and strengthen intellectual property protection. He further said China is "ready to expand friendly people-to-people exchanges" in culture, education, science and technology.

Trade
China's Economic Reforms Aid Foreign Investment
     Economic reforms in China have reduced barriers to foreign investment and international trade significantly, according to a World Trade Organization policy review on China. But the global trade body also concluded that China must continue to restructure its financial sector and capital markets to fully integrate into the world economy. While China's compliance with its WTO commitments has contributed to the decline in trade and investment barriers, the report noted that the government continues to "intervene to 'manage' trade, including for domestic supply considerations." The report is the first top-to-bottom review of China since its ascension to the WTO in 2001. The WTO found that the government still imposes taxes in part to "encourage the exports of electronics products." The body said the government seems to guide investment in technology-based manufacturing in an attempt to encourage domestic companies to upgrade technology and enhance China's competitiveness. For more insights into the U.S.-China relationship, check the stories in our special package that has run the past two weeks.

White House
Bush Picks USTR Portman To Be Budget Chief
     President Bush tapped U.S. Trade RepresentativeRob Portman to serve as director of the White House Office of Management and Budget. Bush also said he will nominate Susan Schwab as the top trade negotiator to replace Portman. "We are going to miss Portman; he had a lot of energy" said Ralph Hellmann, senior vice president at the Information Technology Industry Council. But Hellmann applauded Schwab's nomination. "She's terrific, she knows our industry and she knows the Hill," he added. Bush said Portman has achieved much in his 11 months as trade representative, including winning congressional support for a trade deal with the Dominican Republic and re-energizing global talks at the World Trade Organization. Schwab currently serves as a deputy trade negotiator. She also has experience in the technology sector. From 1993 to 1995, she was Motorola's director of corporate business development.

Broadband
Web Firms Lobby Key Senators On 'Net Neutrality'
     Internet companies concerned about dominant Bell and cable operators favoring certain content on their high-speed Internet networks have accelerated their lobbying of Senate Commerce Committee members, congressional and industry sources said. Many technology industry players have gravitated toward Senate draft legislation on the subject released earlier this month. Technology opponents of the Bell and cable companies "seem to be getting organized, more so than they were in the House," one Senate aide said, and they are "getting out the message that they need" legislation to ensure "network neutrality." The Senate lobbying comes as the House Energy and Commerce Committee prepares for a Wednesday vote on legislation that net neutrality proponents do not think is as favorable. Efforts to change the bill in subcommittee failed, and the same fate is expected in full committee. "The real action on this is going to be in the Senate Commerce Committee," one source said.

Telecom
Senate Commerce Likely To Tackle A Dozen Issues
     Telecommunications legislation emerging in the Senate Commerce Committee looks like it will address a dozen or so issues, congressional and industry sources said. Observers said Chairman Ted Stevens, R-Alaska, might hold a vote on the upcoming bill as early as May 11. Senate Commerce had no comment, except to confirm that the legislation would be comprehensive. Sources said the planned bill focuses on two areas: easing franchise restrictions that govern the entry of the former Bell companies into the video business and strengthening the program that subsidizes telecom service in much of rural America. Observers characterized the Senate draft as having relatively modest language on network neutrality. It also would mandate use of anti-piracy technology known as the "broadcast flag," let cable operators "down convert" high-definition signals for analog cable customers and bolster consumer education about DTV.

Campaigns
Telecom Donations Flow To Powerful Lawmakers
     Communications industry giants are filling the campaign coffers of House lawmakers who are spearheading the push for telecommunications reform. According to Federal Election Commission data through the first quarter of 2006, Energy and Commerce Committee Chairman Joe Barton, R-Texas, is a top beneficiary, as is Speaker Dennis Hastert, an Illinois Republican. Barton sponsored the House bill that is the basis for debate, and Hastert has endorsed it. Other top recipients of the campaign money include: John Dingell of Michigan, the senior Democrat on Energy and Commerce; Michigan Republican Fred Upton, the head of Energy and Commerce's Telecommunications and the Internet Subcommittee; and Edward Markey of Massachusetts, the lead Democrat on Upton's panel. The lead contributors include AT&T, Comcast, Clear Channel Communications, the wireless group CTIA, the National Cable and Telecommunications Association, Time Warner and Verizon Communications. Other donators included Cisco Systems, Comptel, Dell, Qwest Communications and the U.S. Telecom Association.

Security
Terrorism Expert Sees More Sophistication Online
     Terrorist organizations are increasing their presence and sophistication on the Internet in an effort to further their propaganda, exchange ideas and aid recruitment, said terrorism expert Gabriel Weimann, a professor at Haifa University in Israel. "This is the ideal medium for modern terrorism," he said at a New America Foundation event. "It can easily be accessed from anywhere. You don't even have to [own] a computer." There were only 12 known terrorist Web sites in 1998, but today there are 4,800, he said, adding that experts never predicted the growth. For terrorists, the Web's advantages are numerous. It is inexpensive and easy to maintain a site, and difficult to locate users. The technology is global and interactive, meaning users can ask questions or suggest ideas. Terror groups usually have multiple sites in case a few are hacked, and they often change Internet addresses and servers to avoid being blocked.