China-US Relations: Challenges and Opportunities for the New Administration and Congress

China’s Vice Premier Liu He and US Treasury Secretary Janet Yellen talked via video call and discussed the economic situation and US-China relations. According to readouts from China’s commerce ministry and the US treasury department, the two sides agreed that developments in China and the US have important implications for the global economy and it’s crucial for both countries to strengthen communication and coordination of macroeconomic policies. Chinese Vice Premier Liu He expressed China’s views on US tariffs and sanctions and the treatment of Chinese companies in the meeting. Both leaders express a desire to ease bilateral tensions and agree to reopen communication channels, including climate talks that were suspended months earlier. Biden says the United States will “compete vigorously” with China, but that he’s “not looking for conflict.” Xi says the countries need to “explore the right way to get along,” according to a Chinese foreign ministry readout.

1. The US’ Public Company Accounting Oversight Board (PCAOB) has reached an agreement with the China Securities Regulatory Commission (CSRC) and Ministry of Finance (MOF).
2. The new law offers legal foundation for China to counter US and EU sanctions over trade, technology, Hong Kong, and Xinjiang.
3. The meeting highlighted the importance of maintaining open communications channels to manage the two powers’ many differences.
4. Biden says the United States will “compete vigorously” with China, but that he’s “not looking for conflict.” Xi says the countries need to “explore the right way to get along,” according to a Chinese foreign ministry readout.
5. Moreover, it also “restricts the ability of U.S. persons to support the development, or production, of ICs integrated circuits at certain PRC-located semiconductor fabrication “facilities” without a license”.

Chip Wars in a Trump 2.0 World

US companies importing PA will be required to provide tariff deposits at a rate of 43.5 percent to China Customs. The US is proposing to increase tariffs on 14 Chinese goods, targeting renewable technologies, semiconductors, and healthcare products in particular. They include imposing a 100 percent tariff on Chinese electric vehicles (EVs) in 2024, up from the current 25 percent. POM is used for the production of a wide range of products, including auto parts, electronic appliances, industrial machinery, sports equipment, medical equipment, pipe fittings, and construction materials.

Formal Ties and One-China Policy

The same day, Biden’s aides, including the nominee for Secretary of State, Antony Blinken, and the nominee for Treasury Secretary, Janet Yellen, indicated that the president planned to take a multilateral approach by enlisting the support of Western allies to maximize Washington’s leverage on Beijing. While both leaders extended festival greetings to the other, the US side emphasized concerns raised on economic practices, human rights, and Taiwan, while China focused on mutual respect, cooperation, and dialogue. Yang Jiechi accused the US of being “condescending” in its tone and retorted that the US had been misusing its military and financial might and abusing the notion of national security to obstruct trade flows and incite anti-China sentiment. The two leaders addressed an array of geopolitical issues in a joint announcement, including “the importance of peace and stability of the Taiwan Strait”. In another swipe at China, the US and Japan announced to invest together in areas such as 5G, artificial intelligence, quantum computing, genomics, and semiconductor supply chains.

Meanwhile, Wang called on the US to “abide by the one-China principle and the three China-US joint communiqués” (referring to three joint statements made between the US and China between 1972 and 1982 in which the US acknowledged China’s stance on Taiwan and the “One China” policy). The export restrictions do not target any specific country or region, according to the State Council. They are not expected to impact Western companies but will make it harder for military products to be exported investing in the future of food from China to countries such as Russia, Ukraine, and Israel.

A week of massive changes in Ukraine war – and why they all matter

The statement also agreed on the intended contents of the decision on the first Global Stocktake, which will take place at COP28 at the end of November in Dubai. The Global Stocktake is a quinquennial assessment of the progress made on climate change action since the 2015 Paris Agreement. The two sides also discussed other global security issues, including the Russia-Ukraine War and the “provocations from the Democratic People’s Republic of Korea”.

However, as the Communist Party prepares for its big event, they are more likely to want stability than sabre-rattling. In 2021, the US has angered Beijing by sending unofficial delegations of lawmakers to Taiwan and expressing support for the government of President Tsai Ing-wen. “It’s still unclear how much slack Washington is willing to cut Beijing on trade issues, especially given the fact that China is still far behind the pace on the purchases promised under the phase one trade deal,” he said.

The elections come a year after China recalls its ambassador after President Clinton authorizes a visit by Lee, reversing a fifteen-year-old U.S. policy against granting visas to Taiwan’s leaders. Washington has also opposed the global deployment of Chinese next-generation communications technology, especially 5G. While Biden did not delve too much into economic issues, Xi did raise the topic of trade, appealing directly to American businesses and imploring the US to stop stretching the concept of “national security” to suppress Chinese businesses.

Xi criticizes the sanctions, saying they “would only make people suffer.” Both leaders express support for peace talks. The United States imposes a diplomatic boycott of the Winter Olympics in Beijing, citing the Chinese government’s human rights abuses in Xinjiang and elsewhere. A handful of other countries, including Australia, Canada, and the United Kingdom, also refuse to send officials to the games. Chinese officials say the United States is trying to “politicize sports, create divisions and provoke confrontation.” No athletes publicly protest during the Olympics, though several skip the opening ceremony and speak out against China’s abuses cmc markets review 2021 user ratings bonus demo and more after the games.

The US has granted licenses authorizing suppliers to sell chips to China’s blacklisted telecom company Huawei for its growing auto component business, according to Reuters, citing two people familiar with the matter. The items simple and effective exit trading strategies which are exempt from retaliatory Chinese tariff were listed in Tariff Commission Announcement 2021 No.2 and Tariff Commission Announcement 2020 No.8. The 81 products include some shrimp, timber, electric vehicle batteries, microscope, and medical testing instruments. China’s Ministry of Finance announced to extend a tariff exemption for 81 products imported from the US. The tariff exemption, which was due to expire on September 16, 2021, has now been extended until April 16, 2022, according to Tariff Commission Announcement 2021 No.7.

However, the two leaders found common ground on the importance of preventing the use of artificial intelligence in nuclear decision-making. With North Korea’s role in the Ukraine conflict raising concerns, Biden urged China to leverage its influence to prevent further escalation. U.S.-China relations sharply deteriorated in 2020, after three years of steadily declining under the Donald J. Trump administration. Beijing and Washington traded blame over the coronavirus pandemic, remained locked in a trade war, competed over 5G networks and other technologies, and clashed over rights abuses in Xinjiang and Hong Kong, among other issues. A handful of countries have signed free trade pacts with the island; New Zealand and Singapore are the only developed economies to sign such agreements. Beijing has also pushed for Taiwan’s exclusion from multilateral trading blocs, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP).