WASHINGTON — A few years ago, Dallas-based architecture giant HKS entered — and won — a high-profile competition to design the centerpiece of a horticulture expo in Qingdoa, a coastal Chinese metropolis of more than 9 million people.

But the firm couldn’t reach a fee agreement with local officials, who cut off negotiations without explanation or compensation.

That seemed to be that, until an HKS partner saw the expo that came to fruition. He was stunned. The venue featured a pale facsimile — ripped off by a local design institute — of the firm's plans for a striking conservatory filled with lush biomes, recalled Ralph Hawkins, HKS' chairman emeritus.

“There’s nothing we can do,” Hawkins remembered thinking, knowing from years of working in China that the “lack of rule of law” means American businesses operating there “basically have no recourse against anybody.”

Those kinds of experiences are hardly unique among businesses in Texas and across the U.S.

Unfair trading practices in China are at the core of President Donald Trump’s high-dollar trade war against America’s economic rival, particularly when it comes to longstanding complaints over intellectual property theft, forced technology transfer and other costly problems.

The underlying issue often gets lost in the cacophony of concern that's emerged from the business community over Trump's reliance on tariffs as a way to force Beijing's hand.

But there’s widespread agreement about the need to bring China to account. That urgency has only increased as more and more U.S. companies have found that they can’t afford not to work in China, challenges and all, because of the vast business opportunities there.

Count Hawkins, who retired as HKS’s CEO in 2014, as among those who believe Trump’s tariffs are a worthy gamble.

“In the long term, if the tariffs could bring us to the table to negotiate some of these items, everybody would be for it — believe me,” said Hawkins, who stressed that HKS has also had many positive experiences in China. “Because it is unfair.”

Dallas-based HKS won a design competition a few years ago for a high-profile horticulture expo in Qingdoa, China, only to have its plans ripped off without compensation, said Ralph Hawkins, the firm's chairman emeritus. A side-by-side rendering of HKS' design and the one ultimately done by a local design institute in China shows the similarities. (Courtesy of Ralph Hawkins/HKS)

The state of America’s months-long trade war with China remains in flux.

Trump last week called a truce, reopening talks, after meeting with Chinese President Xi Jinping at an economic summit in Japan. The U.S. agreed to hold off on imposing new tariffs on Chinese goods, while Trump said China agreed to purchase products from U.S. farmers and ranchers.

But all of the earlier escalations remain in effect.

The president has imposed import levies on $250 billion in Chinese goods, hitting all manner of products with added costs that often get passed on to U.S. consumers. China has responded in kind, enacting retaliatory tariffs that have dinged farmers and ranchers in Texas and beyond.

That tit-for-tat has drawn substantial backlash from businesses dealing with the added tax, almost obscuring the whole point for the trade throw-down.

Trump sometimes fixates on the trade deficit the U.S. runs with China, accusing the country of ripping off the U.S. for decades and blaming the flood of cheap Chinese-made goods for harming U.S. manufacturing and jobs.

But the basis for his action is actually the U.S. Office of the Trade Representative’s finding — disputed by China — that China’s trade practices are “unreasonable” and “discriminatory.”

“The complaints against China’s trade practices are very real,” said Doug Barry of the U.S.-China Business Council, a Washington-based industry group whose members include the likes of Dallas-based AT&T, Irving-based Exxon Mobil and Dallas-based Texas Instruments.

Among the issues flagged by Barry: The proliferation of fake goods made in China. The practice of forcing U.S. companies, via joint ventures, to transfer over prized tech in order to operate there. The government subsidization of Chinese enterprises, which undercuts U.S. businesses.

“The good news is that China is reforming, and many U.S. companies are doing well,” said Barry, whose group supports Trump taking action against China but opposes the use of tariffs as the way to do it. “The bad news is the pace of reform is slow and spotty.”

HKS chairman emeritus Ralph Hawkins, at right in a 2012 photo, said China has "such a growing economy, I don't think any firm can ignore it." But Hawkins, who retired as HKS' CEO in 2014, emphasized that China is a "tough place to practice." (File Photo / Staff)

The architecture industry offers a window into that reality.

Trade often gets shorthanded to its most tangible form, the flow of goods from one country to another. But the exchange of services is also part of the equation, with building design offering a high-demand example in China amid an extended economic boom there.

HKS started doing work in China in the 1980s, Hawkins said. It started looking at opening an office there after the turn of the century. It now operates a team out of Shanghai, producing sparkling designs for hospitals, luxury hotels and office buildings.

“It’s such a growing economy, I don’t think any firm can ignore it,” Hawkins said, reiterating that there are many scrupulous clients in China who make it worthwhile to do business there. “But it’s a tough place to practice.”

So while Hawkins doesn’t discount the real financial pain that many U.S. businesses are now facing due to Trump’s tariffs, he also wants to make sure it’s not forgotten that many companies operating in China have been facing substantial costs of another sort for years.

The fiasco over the horticulture expo, which HKS tabbed as a $1.3 million financial hit, was just one example.

Hawkins recalled another time his firm was about a third of the way through the design process for a hospital project in China when the client decided to call it off. And not just that. The client also said it wasn’t going to pay HKS for its work, Hawkins said.

Hawkins proceeded to meet with the client in Shanghai. He explained that his firm was a service provider, not an investor. That they had an agreement on the books. That payment was required. The client declined, instead offering to find Hawkins another job.

“I’m not sure I want another job if the agreements don’t mean anything to you,” Hawkins recalled saying.

President Donald Trump and Chinese President Xi Jinping agreed to a trade truce last week after meeting at an economic summit in Japan. But all of their earlier tariff escalations remain in effect. (Brendan Smialowski / Agence France-Presse)

Those sort of anecdotes drew a knowing chuckle from Lance Josal, a Dallasite who worked for Hawkins years ago and who recently retired as the chief executive officer of another international architecture firm, CallisonRTKL.

“That happens all the time,” said Josal, who became closely acquainted with China through the company’s three offices there.

He likewise stressed that doing business in China has been “lucrative and very successful,” adding that the “Chinese people are some of the most entrepreneurial clients you will ever meet in your life.” But he left no doubt about the challenges.

“There are rules in China, just like there are rules in the United States,” said Josal, who now runs a consulting business. “But the rules in China can be manipulated or broken.”

He recalled a time when one of his offices there started getting unusual calls from clients who were disappointed by poorly done designs.

That didn’t add up. So Josal’s team looked into it and discovered RTKL wasn’t even involved in the projects in question. Instead, it turned out, there were at least two rogue firms presenting themselves as RTKL, with slight variations, to game the system and defraud clients.

He told his legal team to shut the impostors down. But he was told it would do no good.

“China is fraught with interesting situations,” said Josal, who nevertheless offered skepticism that tariffs were the right approach to take with Beijing.

That’s the backdrop for ongoing trade negotiations.

It would be one thing if Trump can use tariffs to secure a trade deal with China. It would be entirely another if such an agreement takes a real swipe at addressing some of the deep-rooted problems. And still another if any deal ends up being enforceable in a realistic way.

Experts like David Jacobson are dubious.

He advises U.S. companies on how to operate in China after spending years traveling between the two countries on business. He’s also the executive director of online education at Southern Methodist University’s Cox School of Business.

Jacobson cautioned against viewing the latest trade truce as “really a substantial lessening of tensions,” explaining that it’s “not politically expedient for the Chinese” to make a deal. To that end, he’s bearish about the prospect of an agreement that produces systemic change.

“I would love to see it,” he said. “But I don’t have much hope.”