Illustration: Peter C. Espina/GT

 Chinese e-commerce giant Alibaba's membership in the International Anti-Counterfeit Coalition (IACC) was suspended recently, only one month after the company joined the organization. The suspension has been widely blamed on Alibaba's ignominious history of failing to exterminate the inflow of counterfeit products on its subsidiary B2B and B2C platforms, especially Taobao. This seems to be a new blow to the company's reputation.

Ahead of its IPO at the NYSE in 2014, Alibaba took a tough line against piracy and fake goods on its online marketplaces, terminating all counterfeit suppliers if their delinquencies were ascertained. This round of crackdowns helped Alibaba achieve the world's biggest tech IPO, but afterwards, counterfeits rapidly remerged, even though the company has spent $160 million to address the malady since 2013.

Alibaba's problem is not its alone. Its international rivals, including Amazon and ebay, have been fighting with counterfeits for years. Complaints about acquiring fake products from third-party sellers can be easily found on these two well-known online marketplaces. The only difference is that the counterfeiting problem with Alibaba, particularly Taobao, is more serious because the Chinese economy has a larger share of knockoffs.

China is walking on the same path most established economic powerhouses once chose. Germany, Japan and the US were all once known for churning out cheap and shoddy goods. During a tour to the US in the 1840s, Charles Dickens was furious about the pirate copies of his books. Such violations of copyrights have become almost extinct in the US nowadays, but are still rife across the Pacific Ocean.

The process of major economies' prosperity indicates a pattern. The knockoff economy, argued by Oxford University economists Kal Raustiala and Christopher Sprigman, can drive an economy toward thriving creativity in the face of copying. Many examples have demonstrated that rising economies can absorb the latest technologies and production techniques through piracy.

But the deficiencies of knockoff economy are significant. They will certainly jeopardize the image and profits of well-established quality brands, and ruin the market when "bad money drives out good." On a boundless e-commerce platform such as Taobao, the deficiencies can be massively expanded, and the side effects will also be magnified. The basic principle of fair competition, survival of the fittest, will be applied from a negative perspective.

However, tough crackdowns by Alibaba or government authorities, although necessary, can hardly eradicate counterfeits, because they can hardly reverse the pattern. It is the nature of the economy. The solution can't simply lie in calling for harsher penalties on counterfeiters, but requires leading them to produce quality goods and convince consumers. This solution requires the government to do more elsewhere such as remitting taxes, reducing logistical expenses, and offering skill and technique training.

The government can play a leading role in reversing the atmosphere poisoned by a market rife with counterfeits, but rigid directives, orders and punishments will probably reinforce the knockoff economy, and push counterfeiters to figure out more crafty ways of producing and selling fake goods. The sooner Chinese companies are willing to produce quality products and offering quality services, the sooner China can step away from the knockoff economy and remove the stigma from "Made in China."

The author is a Global Times editor. liuzhun@globaltimes.com.cn