they re going to get all the information of foreign companies, they re going to give it to their own chinese enterprises which will out-compete us because they ll know everything we know. the chinese have done this so many times if the past and they ve even bankrupted large companies like nortell networks. this is going to be an effort to sort of crip l he l cripple forn companies and you put them out of business. arthel: how much leverage does china have to enforce the law? it has a lot of leverage right now. we have trade talks going on. i don t know if any agreement is ever going to be able to he help us. foreign companies want to do business in china. only when the chinese economy will start to crumble, and it will probably do that pretty soon, until that time, beijing has the upper hand. arthel: when you say pretty soon, how soon? this could be sixes months, a year. we re seeing bad numbers coming out of beijing, underlying indicators that were released in september, for insta
imports, which showed a decline. it doesn t look good at all. arthel: but that s six months. you don t have a crystal ball. but even in six months, gordon, that s enough if the rule goes into effect december 1, that s all they need. they need a few days to get it. yeah. this is onerous. as you pointed out, no encryption permitted. no virtual private networks permitted. those allow companies to access websites that are banned in china. probably companies will have to use chinese servers, there will be intrusive inspections by beijing, source codes will be given up to beijing authorities. this is really, really bad, arthel. arthel: eye ironic, the visitl wall private networks virtual private networks are what we use to protect yourself. does the u.s. have a choice? i think we ve been trying to
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delay the a application of these rules for quite some time. we ve been successful up to now. but that looks like it s coming to an end. the u.s. can actually force u.s. companies out of china because we got tradeing with the enemy act and the international emergency economic powers act. it sounds harsh but we re not driving this. the chinese are. xi-jinping, he basically wants to put all foreign companies out of business. we don t have much of a choice because our backs are against the wall. arthel: can americans companies afford not to do business in china? well, you know, they think that they have to be there and they ve got a big consumer market. but on the other hand, with the crumbling economy, one that could fall apart, we might be doing them a favor by pulling they ll out of china. but clearly, one thing is xi-jinping, the chinese ruler, is pushing them out. arthel: let s go to the trade talks. what happens to the trade deal with china? you heard mr. navarro saying supposedl
arthel: growing concerns among u.s. businesses over chinas revised cyber security rules which demand all foreign companies doing business in china to stope stop encrypting r data which would give beijing full access to intellectual property and raises privacy concerns. the white house says the concerns have been addressed in trade talks. phase one includes very solid chapter on intellectual property and a good start on this issue of forced technology transfer, in that the chinese are accepting the rule that the government of china must not force technology transfer. phase two would flesh that out. arthel: let s bring in gordon chang, foreign affairs journalist and author of the coming collapse of china. we ll get to the trade talks in a second, gordon. why would china want this and how does this change the game? this is a cyber security law with new rules going into effect on december 1 and the reason why they want it, arthel, is because