"These are just some factors as to why for a larger number of exporters, China's role as the 'factory of the world', is being re-examined," he said. "There are other factors and for exports to the U.S. - China's largest single market - the UCA is one of them."
Dealing with illegal IT software
Mudd said all companies using IT software in their production or back office processes must pay for it as they would any other material or machine used. "According to a recent report from IDC, the research firm, the use of illegal software cost the copyright owners some US$59 billion in 2010. For commercial or business software, the value of illegal software was interestingly highest in the United States, but second came China at US$7.78 billion. It should be noted that Japan, Germany, the U.K. and Brazil all rank higher in value than most Southeast Asian countries, in terms of unpaid for or copied software."
"Although the law does not explicitly target China [or any other country], given the above trade numbers, it will naturally mean that imports will be looked at closer by Washington state authorities for compliance from major trading partners," he said. "Although exports to China are up year-on-year for the first three months, so are imports, so the deficit remains almost the same. It could be argued based on the IDC study that a greater proportion of these exports are not in compliance with the UCA, which gives a clear opportunity for exporters from Southeast Asia."
"This is perhaps where there is an opportunity for Southeast Asia: to seize this advantage and encourage companies to make sure they are in compliance with the UCA," said Mudd. "Indeed this should be addressed as a matter of some urgency to develop global standards and certification, similar for example to what has been done in the field of environmental sustainability."
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