This past Thursday, President Donald Trump gave an upbeat assessment of efforts to settle our trade dispute with China. Vice Premier Liu He promised China would buy more U.S. farm and energy products and would invite more U.S. capital into its manufacturing and financial-services sectors. American trade representatives also will try to get China to take steps that will reduce its trade surplus with America, some $350 billion annually.

Because exports are so important to sustaining the Chinese economy, its officials have tried to reduce the negotiations to increasing imports of American goods. They have not addressed widespread Chinese theft of our intellectual property.

I feel strongly that President Trump is correct in confronting China over its theft of our intellectual property, which refers to inventions, literary and artistic works and designs used in commerce, according to the World Intellectual Property Organization. The president decided to impose tariffs on $50 billion worth of imports from China as punishment for its thefts. The $50 billion figure is based on U.S. estimates of the lost corporate earnings caused by China’s IP theft or forced technology transfers through counterfeiting famous brands, stealing trade secrets and pressuring companies to share technology with Chinese companies to gain access to China’s vast market.

The current situation is gloomy because growth is slowing in both countries. Analysts expect China to grow slightly over 6 percent, its slowest growth in 28 years. America’s gross domestic product is forecast to slip below 3 percent. Declines in economic activity portend lower levels of exports and imports for both countries.

A number of big U.S. companies already have reported that their sales are suffering because of China’s economic slowdown.

Caterpillar blamed its biggest earnings miss in a decade on decreased Chinese demand. Hardware manufacturer Stanley Black & Decker reported lower revenue from China’s construction industry.

Apple CEO Tim Cook published a letter to investors warning of weaker-than-expected first-quarter earnings, citing “fewer iPhone upgrades than we had anticipated” in China,” which makes up about 15 percent of Apple’s global revenues.

China has enjoyed tremendous export success in industries such as furniture, apparel and computers. Its competitive advantage in labor costs and supply-chain logistics is robust. It would take a long time for us to duplicate its advantages if it could be accomplished at all.

On the other hand, we have a comparative advantage in high-end, skilled services. American companies have enjoyed tremendous success globally outside of China in financial services, consulting and other high-skilled service industries. Currently, the U.S. is exporting nearly $60 billion annually in these sectors.

According to the Central Intelligence Agency World Factbook, the following export groups represented the highest dollar value in American global shipments during 2017

1 — Machinery, including computers — $201 billion.

2 — Electrical machinery — $174 billion.

3 — Mineral fuels, including oil — $138 billion.

4 — Aircraft and spacecraft — $131 billion.

5 — Optical and medical apparatus — $83 billion.

But because China restricts high-end services by U.S. companies, our share of Chinese markets in these areas is lagging.

While a trade war will hurt both countries, China is at a relative disadvantage. It needs to maintain its trade surpluses to the United States in order to sustain its growth momentum. To offset a potential decline in exports, China has made major expenditures on infrastructure that will have benefits in the future.

On a personal basis, I have an investment in a small American technology company that is fearful of selling to a Chinese company. We worry that they will reverse-engineer our product and then not only bypass us but also sell “their product” in competition with us.

Clearly, if our respective countries could resolve their differences on intellectual property, my company would enjoy enhanced sales and China would obtain a superior product. But that’s a big “if” right now.

Originally published in the Sarasota Herald-Tribune