Trade Taking Back Seat to Geopolitical Issues With China, Panelists Say
Trade was barely touched on during the virtual meeting of President Joe Biden and Chinese President Xi Jinping, said Anna Ashton, vice president of government affairs for the U.S.-China Business Council. Ashton, who was speaking on a Nov. 23 Twitter panel hosted by Neysun Mahboubi, a research scholar at the University of Pennsylvania's Center for the Study of Contemporary China, said that follows a pattern in the administration. She said that "they are unabashedly reframing the relationship… as a competitive one," which makes her wonder where the commercial relationship fits in. The recent panel was reacting to the earlier video call (see 2111160004).
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Politicians in Washington from both parties frequently characterize trade with China as a matter of competition, as well, saying that Chinese industrial policy damages U.S. companies that compete in the same space. But Ashton characterized trade with China as mutually beneficial.
Paul Triolo, who heads a technology group at Eurasia Group, a political risk advisory firm, agreed that there doesn't seem to be a real desire to re-engage in trade discussions with China on the part of the administration, the so-called phase two issues, such as industrial subsidies.
He also said he doesn't expect there to be an expansion of export controls before the U.S. and allies can discuss their approach.
Although the panel began with the meeting, Ashton also talked about what might happen with the China package that passed the Senate in the summer, which is part of what she called the "run faster" plank of competing with China. She said it's important to balance a competitiveness policy that boosts American innovation and manufacturing with punitive actions against China, which she said "essentially amount to containment strategies."
Ashton said the fact that the package is going to conference with the House means something actually might get passed. But, she cautioned, "we know many House Republicans are very dissatisfied with the EAGLE Act (see 2105260005 and 2109020053)." She said they think it is too soft on issues like Taiwan. She said that House Republicans on the conference committee might feel the text of the Senate bill also is too soft.