It is therefore likely that more companies will be required to delist before a workable solution is found. Meanwhile, Chair of the PCAOB Erica Y. Williams stated that “On paper, the agreement signed today grants the PCAOB complete access to the audit work papers, audit personnel, and other information we need to inspect and investigate any firm we choose”. Blinken’s meetings in Beijing are undoubtedly a positive sign of a “thaw” in the relationship and marks an incremental step toward more stable ties. Progress henceforth will hinge upon the two sides’ ability to handle unforeseen events that could once again derail the relationship.
- Driven by the US’s previous threats to use nuclear weapons, Mao pushes for China to develop its own nuclear deterrent.
- Effective September 27, tariff rates will increase to 100% on Chinese electric vehicles, 50% on solar cells, and 25% on EV battery parts, critical minerals, iron and steel, aluminum, masks, and shore container cranes.
- President Barack Obama announces the United States and eight other nations have reached an agreement on the Trans-Pacific Partnership—a multinational free trade agreement.
- These companies and entities added to the Entity List are required to apply for licenses from the Commerce Department and face tough scrutiny when they seek permission to receive items from American suppliers.
One of the most recent estimates by the independent policy think tank National Bureau of Asian Research in 2017 found that the annual cost of Chinese IP theft is between $225 and $600 billion PDF. Under China’s state-led economic system, government policies often require firms to transfer technology and other capabilities in exchange for operating in China. Although China’s IP laws have improved over the past decade, theft is still prevalent, even unholy grails – a new road to wealth among Chinese firms that have appropriated capabilities domestically.
It could therefore be an opportunity to improve the deteriorating US-China relations by providing a platform on which to advance collaboration, according to analysts. The US Special Presidential Envoy for Climate John Kerry has told Reuters that he has been invited to visit China in the “near term” for talks on the climate crisis. The Customs Tariff Commission of the State Council has announced it will extend the tariff exemption on a batch of goods that were due to expire on May 31, 2023. The tariffs on 95 goods included in the 11th batch of tariff-exempted US goods will continue to be waived until December 31, 2023. The tariffs on US goods were imposed as a countermeasure to the US Section 301 tariffs on Chinese goods. On Friday, China reportedly turned down a proposed meeting between the US and Chinese defense chiefs.
Rising Trade Tensions
Experts expect the move to hobble China’s domestic chip industry, which has received a surge of government funding in recent years but still lacks the ability to manufacture the most advanced chips. A Chinese Foreign Ministry spokesperson says the United States “will only hurt and isolate itself” with the restrictions. U.S. officials also fear that China’s acquisition of sensitive U.S. technology will bolster China’s military. U.S. firms and officials have long accused Chinese companies of stealing intellectual property to develop counterfeit products, pirated software, access trade secrets, and forced technology transfer on condition of doing business in China.
The State Department Overhaul Is Long Overdue
The meeting is the latest in a concerted effort by the US and China to revive bilateral dialogue following the deterioration of relations in the past few months. China’s Ministry of Commerce (MOFCOM) has updated the Catalog of China’s Prohibited and Restricted Technologies for Export, per an announcement. The new catalog adds a range of high-end technologies, including laser radars, drones, and biotechnology products. The announcement also states that technologies with dual military and civilian uses are subject to export controls. The two also discussed a variety of global security and regional issues, including the Russia-Ukraine war, the Middle East, the DPRK, the South China Sea, Burma, and cross-strait relations.
Now led by Democratic US President Jimmy Carter, and a reformer, Deng Xiaoping, the two countries issue the Joint Communique on the Establishment of Diplomatic Relations, normalising their ties. The US also endorses the One China Policy and transfers diplomatic recognition from Taipei to Beijing. Chinese and Soviet differences in dogma blow up into conflict when Beijing orders troops to take over Zhenbao Island on the countries’ eastern border, with fighting also breaking out on China’s northwestern border in Xinjiang.
South Asia Brief
President Biden wanted to stabilize relations with the PRC because he is aware of the growing potential of his “rival”. Analyzing the shape of US-Chinese relations, it is worth pointing out that for Biden it was not a partnership conversation, but rather negotiations with the main rival in the race of powers. “So we believe that it is important for the United States to change its own image and to stop advancing its own democracy in the rest of the world.” – Yang Jiechi spoke during the talks. The sanctions announcement was made during a visit by the US State Secretary Antony Blinken and Defense Secretary Lloyd Austin to Japan and South Korea. Some leading Western apparel brands like H&M, Nike, Adidas, and Burberry faced backlash and boycotts in China due to their stated concerns over the alleged use of forced labor in Xinjiang. The US Senate Foreign Relations Committee’s Democratic Chairman, Senator Robert Menendez (D-New Jersey), and the Republican Senator of Idaho, Jim Risch, introduced a bipartisan agreement entitled the Strategic Competition Act of 2021.
Semiconductor controls
In his first months of his second administration, Trump has threatened tariffs as high as 145 percent on all Chinese goods, and Beijing’s latest retaliatory tariffs on U.S. imports are as high as 125 percent. Some economists doubt Trump’s approach will achieve its desired goals and raise concerns that tariffs will drive up inflation and the costs of goods, hurting U.S. consumers and exports. For China, the meeting was an opportunity to mark the growing position of Xi Jinping’s regime. The United States sought to show readiness for the talks of key importance for world politics. The case of Taiwan’s independence or Chinese espionage was expected to be raised.The meeting of diplomatic representations defined the direction of international politics and indicated a list of bilateral disputes.
US, China announce a trade agreement — again. Here’s what it means
During this meeting, He reportedly stated that “China is willing … to promote the development of bilateral relations in a healthy, stable and sustainable direction”, based on the progress made on bilateral ties during the meeting between President Biden and President Xi in San Francisco in November. The Chinese Ministry of Foreign Affairs readout noted that the meeting occurred at Blinken’s request and that both sides agreed to maintain communication and further implement the understandings reached by Presidents Joe Biden and Xi Jinping at the San Francisco meeting in November 2023. Wang Yi pointed out that while communication between the two governments has increased, the US has continued its containment and suppression of China, leading to rising risks and challenges in the bilateral relationship. According to the PBOC readout, the PBOC and the Treasury signed an exchange of notes aimed at strengthening China-US financial stability cooperation. The initiative is designed to ensure that both nations’ financial management departments can maintain timely and smooth communication channels, particularly during events of financial stress or when operational risks at financial institutions arise, thereby reducing uncertainty. While the rule applies worldwide and does not explicitly mention China, exports or reexports of these items to China (and other countries) will require a license, with the license application to be reviewed “with a presumption of denial”.
Israel-Iran conflict was “a stage” for U.S. and China’s contrasting approaches
The statement also agreed on the intended contents of the decision on the first Global Stocktake, which will take place at COP28 at the end of November in Dubai. The Global Stocktake is a quinquennial assessment of the progress made on climate change action since the 2015 Paris Agreement. The US and China have agreed to ramp up cooperation on climate action, following meetings last week between climate envoys Xie Zhenhua and John Kerry in California.
- In May 2024, the US raised tariffs on Chinese EV imports from 25 percent to 100 percent, citing the domestic development of the industry as a motivator for the hike.
- The Group of Seven (G7) objects to China’s “aggressive military activity,” saying it risks destabilizing the region.
- He issues the Six Assurances to Taiwan, which includes pledges to not mediate between both Chinas, honour the Taiwan Relations Act and have no plans to stop arms sales to Taipei.
- US officials expressed concerns about China’s lack of communication, citing provocative behavior and a rise in risky intercepts of US aircraft by China.
This sentiment has remained prominent since the release of the March survey, in which respondents “cited ‘rising tensions in US-China relations’ as their top challenge”. Meanwhile, highlights of the speech released by the Ministry of Defense state that “China stays committed to the path of peaceful development“ and that “China is ready to work with all other parties to build stronger security and confidence-building systems”. At the same time, it also stated that China “will never hesitate to defend our legitimate rights and interests, let alone sacrificing the nation’s core interests”. Blinken’s upcoming visit has raised hopes of a “thaw” in US-China relations, but US officials have emphasized that they do not expect a major breakthrough. Both sides agreed to maintain high-level exchanges and communications on important issues “at all levels in the economic field”, which was a major outcome of the meeting between President Biden and President Xi in Bali in November 2022.
Still, Trump faults the WHO for being biased toward China and halts U.S. funding to the organization. President Obama hosts President Xi for a “shirt-sleeves summit” at the Sunnylands Estate in California in a bid to build a personal rapport with his counterpart and ease tense U.S.-China relations. The leaders pledge to cooperate more effectively on pressing bilateral, regional, and global issues, including climate change and North Korea. Obama and Xi also vow to establish a “new model” of relations, a nod to Xi’s concept of establishing a “new type of great power relations” for the United States and China. The U.S. trade deficit with China rises from $273.1 billion in 2010 to an all-time high of $295.5 billion in 2011. In March, the United States, the EU, and Japan file a “request for consultations” with China at the World Trade Organization over its restrictions on exporting rare earth metals.
In addition, the readout said that “China stated its serious position on Taiwan and other major issues of principle. Meanwhile, the readout from the Department of State writes that Blinken “emphasized the importance of diplomacy and maintaining open channels of communication across the full range of issues to reduce the risk of misperception and miscalculation”. The announcement also states that the visit follows the directive of President Joe Biden to deepen communication with China, a commitment he reached with Chinese President Xi Jinping during their last meeting at the sidelines of the G20 Summit in Bali, Indonesia in November 2022.