Daily Management Review

A New 'Strike Force' To Target China On Trade Set Up By Biden Administration


With the Biden administration roiling out a set of findings of a review of the access of the United States to critical products – ranging from semiconductors to batteries for electric vehicles, plans of targeting China with a new "strike force" to address unfair trade practices were also announced by the White House.
Senior Biden administration officials told the media that the US trade representative will lead the "supply chain trade strike force" and will be tasked with identifying the specific violations that have resulted in a "hollowing out" of supply chains that could be tackled with trade remedies, including against China.
An investigation based on Section 232 into the impact on the US national security by import of neodymium magnets that are used in motors and other industrial applications was also being considered to be initiated by the Department of Commerce, said the officials. These products are mainly imported into the US from China.
The review of critical supply chains was ordered by the US President Joe Biden in February and has asked executive agencies to file reports within 100 days. The reports were focused on the level of access of the US to critical goods such as those important for the pharmaceutical industry as well as access to rare earth minerals for which the main source of accessing is through imports.
Even though China has not been explicitly named in the review report, these measures are being viewed as a part of a broader strategy of the Biden administration to boost the competitiveness of the US to combat the trade and economic challenge posed by China – the second largest economy of the world.
"Semiconductors are the building blocks that underpin so much of our economy, and are essential to our national security, our economic competitiveness, and our daily lives," U.S. Commerce Secretary Gina Raimondo Gina Raimondo, said in a statement.
During the Copvid-19 pandemic, there were serious challenges faced by the United States in accessing medical equipment while the country also currently faces severe bottlenecks in a number of areas such as those in semiconductor chips used in computers and cars – production of which have been impacted because of the shortage.
US agencies are required to issue more complete reports a year after Biden's order, identifying gaps in domestic manufacturing capabilities and policies to address them.
Unfair trade practices from "a number of foreign governments" had hit the United States through all the four supply chains that were included in the initial review – which included issues such as government subsidies and forced transfers of intellectual property, said a senior official of the Biden administration.
"Obviously, a number of Chinese industrial policies have contributed to vulnerable U.S. supply chains," the official said. "I think you are going to see this strike force focusing in feeding into some of our China policy developments."
The official added that the United States was not seeking to "wage trade wars with our allies and partners," while also noting that the mandate of the strike force would be on "very targeted products."