U.S.-China Trade Dispute Not Going to End Soon as Trump Continues Banning Chinese Firms

Investors begin to see brighter outlook on the U.S.- China trade dispute as soon as it was clear the Democrat’s Joe Biden would be the next president of the United States of America, but Trump’s administration has made the soon-to-be elected president’s job harder by continuing banning Chinese firms.

 

In October, the U.S. state department moved to add Chinese fintech giant Ant Group to a trade blacklist, ahead of its now-stalled public offering.

In the following month, Trump issued an executive order to restrict U.S. investments in Chinese companies, which the U.S. alleges were owned or controlled by the Chinese military.

Late November, the incumbent Donald Trump’s administration showed the list of 89 military-ties Chinese firms and companies that the administration expected to ban from buying U.S. goods and technology. The list of companies is part of a draft rule that identifies Chinese and Russian firms the U.S. considers “military end users.”

The export restriction of U.S. goods and products applied to items such as computer software like word processing, scientific equipment like digital oscilloscopes, and aircraft parts and components. While items for aircraft included everything from brackets for flight control boxes to the engines themselves.

 

This week, the Trump administration continued to pressure China by banning cotton imports from one of China’s largest producers, the Xinjiang Production and Construction Corps (XPCC), stating that it used the forced labor of detained Uighur Muslims.

The U.S. went as far as to call “Made in China” a “warning label” and said that the cheap cotton goods you may be buying for family and friends during this season of giving — if coming from China — may have been made by slave labor in some of the most egregious human rights violations existing today in the modern world, said Secretary of Department of Homeland Security Kenneth Cuccinelli.

Even without an escalation in import tariffs of Chinese products, the Trump administration made it hard for Joe Biden to find a common ground with Asia’s most powerful country.

 

As far as the trade deal goes, Biden told New York Times in an interview that he would not immediately end the phase one trade agreement with China or roll back punitive tariffs on Chinese goods imposed by President Donald Trump, adding that the U.S. needed to regain leverage to use in negotiations with China.

“I’m not going to make any immediate moves, and the same applies to the tariffs,” stated Biden.

The soon-to-be president said that the country needed to develop a bipartisan consensus and increase government-led investments in research and development, infrastructure and education to better compete with China

The comment came after several speculations were made, indicating that there’s a higher chance of countries in Asia partnering with the U.S. to counter China under Biden.

 

In the meantime, Biden’s administration will continue to pursue policies targeted at China’s trade practices mainly on stealing intellectual property and forcing tech transfers from U.S. companies to their Chinese counterparts.

 

Although Biden and his team might be less aggressive than Trump when it comes to anything related to an “American First” and more of a “Bipartisanism to Make America Great Again,” the trade deal might not be settled any time soon, while there are more important tasks to focus on such as the economic recovery and the containment of coronavirus in the U.S.