The trade war against China launched by former President Donald Trump isn’t going to end anytime soon, despite a change in leadership at the White House.
After a lengthy review of U.S.-China trade relations, the Biden administration has left in place steep Trump-era tariffs on Chinese imports. Senior officials also say they might take other punitive measures unless Chinese authorities respond to U.S. concerns.
China has failed to meet prior commitments, administration officials say, and in many ways appears to have doubled down on trade practices that the U.S. considers unfair. Those measures include state support for Chinese companies and and broad restrictions on how American companies operate in China.
The one potential concession: The administration might offer “targeted” relief to exclude certain Chinese-made products from tariffs, senior U.S. officials say, if the penalties unduly harm Americans consumers and businesses.
The tariffs on Chinese goods have raised costs for U.S. customers, economists say.
In announcing its strategy, Biden administration officials took great pains to try to differentiate its approach from the Trump White House. They say they are working closer with allies to forge a united front and communicating regularly with China to to stabilize a relationship that was fraught with tension before Biden took office.
“Our objective is not to inflame trade tensions with China,” said U.S. Trade Representative Katherine Tai in a speech on Monday at the Center for Strategic International Studies.
Another senior U.S. official echoed her remark. “We’re two large economies that impact not just the well-being of our people, but people all over the world,” the senior official said.
Yet Tai insisted, much like the Trump White House, that the Biden administration would defend American interests and protect U.S. workers from unfair Chinese trade practices. The U.S. runs a massive trade deficit with China every year.
“We must defend, to the hilt, our economic interests,” Tai said.
The Trump Administration slapped tariffs of up to 25% on tens of billions of dollars’ worth of Chinese goods in launching the biggest global trade war in decades. The trade war hurt American manufacturers and acted as a drag on the U.S. economy in 2019, eliciting strong complaints from businesses and Democrats such as Biden.
Before leaving office, Trump struck a so-called Phase One deal, under which China agreed to buy more American farm and industrial goods in exchange for a relaxation of some U.S. sanctions.
The Biden administration, facing domestic pressure to be tough on China, is still holding the country to Trump’s Phase One agreement. They say Chinese purchases have fallen short of the goal and they plan to discuss the matter in coming weeks with top Chinese officials.
There won’t be a Phase Two part of the deal, however. Tai said the Biden administration would take a different approach.
While she was critical of Trump’s go-it-alone approach, Tai declined to call his policy a bust.
“I wouldn’t say it failed, but it hasn’t gotten us to where we want to go,” she said. “It is useful and has had some value.”