TOKYO -- The former executive chairman of global chemical maker DowDuPont said protecting technology secrets has only grown as a concern for American companies operating in China since his time, but he called tariffs a "blunt weapon" for bringing about change.
"Many of us who built factories in China understood that we could lose our technology, so we [were] always careful," Andrew Liveris, who now serves as a global adviser for Japan's Sumitomo Mitsui Financial Group, told Nikkei here. "But now everyone is being supercareful" for fear of Chinese copying, he added.
Under President Donald Trump, the U.S. has renewed pressure on China over what Washington calls forced technology transfers from foreign companies -- claims that Beijing has disputed.
Liveris said the essence of the trade war is a struggle for access to services and technology. Amid moves by the U.S. to isolate Huawei Technologies, he predicted that China will develop alternative supply chains.
Chinese people "are smart," he said. "It will take a while for them to build, but they will."
The tit-for-tat tariffs being imposed by Beijing and Washington will lead to "readjustment" of trade flows, Liveris said. Citing the 25% Chinese tariff on American soybeans, he noted that China is procuring soybeans from Brazil instead, while the U.S. is stepping up sales to Europe.
The former CEO of the old Dow Chemical argued that China remains an important market for U.S. companies. China's economy is far larger than it was 10 years ago. Even if growth has slowed, "a bigger number and a smaller percentage is still a large absolute number," he said.
More important than tariffs are "market access and nontariff barriers such as standards and specifications," he said.
Liveris said he is not worried about the stock market swings caused by the trade war because, over time, stocks are "not a good predictor" of the real economy. Other indicators such as gross domestic product, unemployment and wage growth all show the American economy on a solid footing, he said.