The Biden administration must confront more directly the harmful effects of Beijing’s economic behaviors, US Trade Representative Katherine Tai says.
In her testimony before the House Ways and Means Committee, Tai warned that considering China’s evading the pressure to fulfill obligations it has under a Trump-era trade agreement, the good-faith effort to engage with Beijing on trade may be hitting its limits.
Biden’s top trade ambassador’s remarks signal a noticeable shift in tone though Tai stopped short of outlining any new trade penalties against China, reiterating instead that existing tools aren’t up to the task.
Tai believes that the US strategy must expand beyond only pressing Beijing for change, recommending the inclusion of vigorous defense of American values and economic interests from the negative impacts of Chinese unfair economic policies and practices.
Back in October, Tai initiated talks with her Chinese counterpart, Vice Premier Liu He, vowing to hold Beijing accountable for not fulfilling its commitment.
Under former President Donald Trump’s Phase One agreement, China was obliged to purchase $200 billion worth of additional American goods over a two-year period -which ended last December – but data showed Beijing fell short of that obligation.
Recognizing China’s behavior as a familiar pattern from its actions at the WTO and in various bilateral high-level dialogues, Tai says that her talks have revealed that Beijing would only comply with trade obligations that fit its own interests.
It’s not unusual or unprecedented, as Tai pointed out, for the US to repeatedly seek and obtain commitments from China only to find that real change or follow-through remains quite elusive.
Leaving the door open for further conversations, Tai called on Washington to bolster American competitors through domestic investments while challenging Beijing’s practices aimed at gaining global dominance over critical technologies.
She reminded that US competitors have suffered in the past from Beijing’s industrial subsidies and other market-distorting actions in critical technologies like EVs and semiconductors since existing trade remedies are too slow or ill-suited.