Democratic presidential candidate Joe Biden is preparing to face tough questions in Tuesday’s debate on how he would approach China if he wins the White House in November.
His team is privately acknowledging that they expect the issue to be a central theme during the first debate in Cleveland, Ohio, according to a person familiar with its planning. For the past week, Biden’s advisers have focused on questions about the world’s second-largest economy, anticipating President Donald Trump’s attacks on the former vice president’s record of dealing with Beijing.
If he defeats Trump, Biden will have to decide whether to eliminate, maintain or increase the billions in tariffs applied to Chinese imports, and whether to adhere to or renegotiate the partial trade agreement that Trump signed in January.
He would have to determine whether his administration continues with sanctions imposed on Chinese officials for their crackdown on human rights in Hong Kong and the western Xinjiang region, and possibly further expand those sanctions.
Biden would also inherit a litany of restrictions to cut off Chinese tech companies’ access to American intellectual property and a patchwork of relationships across the region that could help or complicate tensions with China.
Priorities
Biden’s campaign advisers say they would prioritize domestic issues such as investing in research and development and manufacturing in the United States to compete with Beijing from a position of strength, and address international issues such as trade later. But the multifaceted rivalry with China will be hard to ignore, and high-level political advisers, including Biden’s veteran handyman Jake Sullivan and former Under Secretary of State Tony Blinken have already publicly admitted it.
“China poses a growing challenge. It’s arguably the biggest challenge we face from another nation-state, ”Blinken said last week at an event hosted by the US Chamber of Commerce. “I don’t think the question is who is tough or who is weak with China. The question is who has the most effective strategy to protect and promote our security, our prosperity and our values. “
In the election campaign to date, Biden has offered few details about how he would deal with China’s economic rise, perhaps to maintain maximum flexibility should he win the election. In some cases, you may have a difficult time rolling back your existing policy. Both parties in Congress have been overwhelmingly in favor of tougher action against Beijing on technology, human rights and trade.
Trump has frequently touted his record in China, boasting that he is the toughest president and the first to take on the Asian giant. The president’s campaign has produced multiple television spots that focus on Biden’s earlier comments that China’s rise was good for the United States.
By comparison, Biden’s announcements have criticized Trump for downplaying the threat of the virus as it spreads in China and for policies that allowed the Chinese nation to grow stronger.
Here’s a look at some of the key China-related economic and trade issues that Biden will face if he takes the oath of office on January 20 and what we’ve gleaned from his remarks so far:
Phase one
The deal forged earlier this year has fallen short on one of Trump’s crucial selling points: China’s commitment to buy an additional $ 200 billion in American goods and services over two years. According to Bloomberg Economics, China has so far only bought about half of what it would take to stay on track to hit the annual target.
Full-year data for trade flows will be public in February 2021, shortly after Biden took office, and analysts expect those figures to disappoint as well.
Biden has attacked Trump for praising the deal and prioritizing it over holding Beijing accountable for the spread of the coronavirus earlier this year. But his campaign has not said whether it will keep or reject the deal.
Biden would have to decide whether to build on the deal in a second phase or renegotiate the terms of the existing deal.
When asked about a possible phase two deal in a Biden administration, Blinken listed subsidies and cyber theft as some of the areas where the Trump deal underperformed, saying that “we would have to go back and really get involved in the systemic issues that continue to pose a real problem when it comes to our business relationship with China. “
Rates
Biden could face a setback if he undoes the tariffs, which also have bipartisan support in Congress. So far, he hasn’t compromised one way or another.
He says he will immediately review all of Trump’s trade actions, calling the president’s approach to tariffs “shortsighted and destructive.”
“I will use tariffs when necessary, but the difference between Trump and I is that I will have a strategy, a plan, to use those tariffs to win, not just to feign toughness,” Biden said in response to a questionnaire from the United Steelworkers union.
There is a widely held belief among China watchers that Biden will not eliminate existing tariffs, at least not in the short term.
“He’s going to be a lot more cautious about removing tariffs than people expect, because that’s money. That’s money coming in, ”said Deborah Elms, executive director of the Asian Trade Center in Singapore. “After they’ve been in place for a certain period of time, the fee income is built into the budget and you need to find compensation to account for that.”
Still, what to do with the fees wouldn’t necessarily have to be a binary choice. Biden could decide to lower the tariff rate for certain products or increase the number of exclusions for industries that have been hurt.
Technological career
Biden said he would invest heavily in American R&D to counter China’s technological innovation and acknowledged that certain Chinese companies pose a national security risk to the United States.
As president, he would have to decide whether to continue the Trump administration’s aggressive campaign against Chinese tech companies and inhibit US companies from supplying them.
Shaun Roache, chief Asia-Pacific economist at S&P Global Ratings, says “there is a lot of uncertainty about tactics,” but the strategy of rejecting Chinese technology will likely stick.
One thing the business community looks forward to: more adherence to the rule of law when it comes to national security actions, says Steven Okun, senior adviser at consulting firm McLarty Associates. Under the Trump administration, the definition of national security has been broadened to encompass areas such as competition and human rights.
This month, the Trump administration cited national security when it announced China’s ban on WeChat and TikTok from US app stores. A federal judge this week temporarily blocked the White House ban on TikTok, but the Commerce Department promised to defend the underlying executive order from legal challenges. Separately, to avoid a ban, Tiktok’s parent company ByteDance is negotiating with Oracle Corp. and the US government to take a stake in the Chinese company.
Blinken noted that Biden’s team would focus on commercial cyber espionage after Beijing backtracked from a 2015 agreement between Barack Obama and Chinese President Xi Jinping that set out “very clear demands and specific consequences if China does not take advantage of anti-spyware. American companies “.
But “trying to fully disassociate from China, as some have suggested, I think is unrealistic and ultimately counterproductive,” he said.
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