A US congressional committee on Tuesday issued an extensive list of bipartisan recommendations to help reset the superpower’s economic ties with China. The committee said that these goals for 2024 would prevent the US from becoming China’s “economic vassal.”
The proposal was drafted on the basis of a year of hearings and investigations by the House of Representatives’ select committee on China.
It includes suggestions for dramatic shifts in US regulatory approaches, including restrictions on outbound investment to China, and more technical legal revisions, such as reducing the limit for duty-free shipments from China into the US.
It also covers forcing a ban or Chinese divestment of social media platform TikTok, directing the Commerce Department to impose import duties on Chinese semiconductors, requiring the Federal Reserve to stress-test American banks’ ability to withstand a potential loss of market access to China, and restricting US federal agencies from buying Chinese-made drones.
Implementing such measures would “require hard trade-offs and will not be without cost,” the committee, led by Republican chair Mike Gallagher and Democratic ranking member Raja Krishnamoorthi, said in the report.
“The United States now has a choice: accept Beijing’s vision of America as its economic vassal or stand up for our security, values, and prosperity,” the committee said.
Gallagher and Krishnamoorthi told reporters on a call that the November meeting between US President Joe Biden and Chinese leader Xi Jinping in San Francisco, which aimed to smooth rocky relations, had done little to change their 150 recommendations.
“I think this is really a blueprint for some bipartisan legislation that we’re hoping to move in the next year,” Krishnamoorthi said.
Gallagher said Republicans were having a “robust discussion” on how to move forward with legislation restricting US outbound investment to China. He expressed hope that the discussions would lead to “responsible legislative activity” by early next year.
“Even those major asset managers or bankers with whom we’ve engaged that are sceptical of any restrictions on investment in China, even in military and critical technological areas, I think would welcome the predictability that legislating the issue would provide,” Gallagher added.
US Bipartisan Committee Recommends More Trade Restrictions, Bans on Chinese Interests
The committee said that these goals for 2024 would prevent the US from becoming China’s “economic vassal.”
December 13, 2023
IMAGE SOURCE: Lintao Zhang /APThen-VP Joe Biden meeting Chinese President Xi Jinping, in Beijing, in 2013.