The U.S. Moving to Fight China on Trade, Industrial Policy

The Biden administration plans to tackle China over its industrial subsidies and find methods to safeguard America’s technological advantage, stiffening US economic policy against the country’s major global foe.

According to persons involved with policy deliberations, US initiatives to be launched in the coming months may include a new inquiry into Beijing’s backing for industries it considers strategic under Section 301 of the Trade Act.

Section 301 is a formidable weapon that enables US officials to pick out specific trading partner activities and take punitive action if they find those practices violate international trade law.

While no specific industries were mentioned, China has designated semiconductors, artificial intelligence, 5G wireless, and electric cars as areas in which it aspires to world supremacy.

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Additionally, the White House is considering tightening oversight of American firms’ investments in China, tightening export controls on critical technology, and increasing coordination with European and Asian allies and partners on subsidies and other concerns, these sources said.

The strategy is prompted by growing opinions inside the Biden administration that former President Donald Trump’s tariff campaign against Chinese goods was ineffective in convincing Beijing to compete fairly in international trade.

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