Washington is not seeking to decouple the American economy from China’s, U.S. Trade Representative Katherine Tai said Thursday while on a visit to Tokyo.
Tai, who is on her fourth visit to Japan after being appointed the top U.S. trade envoy, said all members of President Joe Biden’s administration have been “very clear that it is not the intention to decouple” China’s economy.
U.S. trade sanctions against China are “narrowly targeted,” she said.
Given its huge size and importance, unraveling the ties with China that keep the world economy running is “not a goal or achievable,” Tai said in a news conference at the Foreign Correspondent’s Club of Japan.
Chinese officials have often lashed out at the U.S. over trade sanctions and other restrictions on sharing of advanced technology with China, accusing Washington of trying to “contain” China and hinder its path toward greater affluence.
Tai said that regular trade work between the U.S. and China was continuing and she was “completely open to engaging with my counterparts in Beijing,” though she has no immediate plans to visit China.
At the same time, the United States is seeking to strengthen and expand economic security cooperation with its Asian allies and partners in response to China’s growing assertiveness and its dominance in many manufacturing industries.
Security and stability of supply chains is an issue that has gained urgency after disruptions caused by the pandemic and controls imposed to try to fight outbreaks of COVID-19 resulted in shortages of computer chips and other goods.
A recent agreement on trade in critical minerals will allow electric vehicles using metals sourced or processed in Japan to qualify for tax breaks under the Inflation Reduction Act. That deal is evidence of the U.S. commitment to “building collective resilience and security,” Tai said.
“We have all experienced the fragility of our dispersed supply chains in recent years, especially through the pandemic and Russia’s brutal, unjustified attack on Ukraine,” Tai said. “And we’ve become too reliant, we have discovered, on certain countries for the supply of critical minerals needed to fuel our clean energy future.”
A new approach
The Biden administration has been adopting a new approach to global trade, arguing that America’s traditional reliance on promoting free trade pacts failed to anticipate China’s brand of capitalism and the possibility that a major power like Russia would go to war against one of its trading partners.
Tai recently gave a speech at American University, where she spoke of “friend-shoring” — building up supply chains among allied countries and reducing dependence on geopolitical rivals such as China.
Tai pointed to a new trade partnership with Japan that she said has brought “tangible results for our workers, small businesses, and producers on both sides of the Pacific.” That includes an agreement to lift limits on U.S. exports of beef to Japan and a new biofuels policy to facilitate exports of more ethanol to Japan, she said.
Tai also reviewed the status of negotiations on the Indo-Pacific Economic Framework, or IPEF, a new trade pact proposed by Washington.
She said a third round of negotiations on the accord was planned in two weeks’ time in Singapore.
The framework has 13 members, including the U.S., that account for 40% of global gross domestic product: Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam.
Efforts to fortify relationships
The U.S. has stepped up diplomacy across the region, with Secretary of State Antony Blinken stopping over the weekend in Vietnam, which Washington sees as a key component of its strategy for the region given the country’s traditional rivalry with its much larger neighbor China.
Tai’s Tokyo visit follows a trip to the Philippine capital, Manila, to help fortify trade relations among the three countries as they build both economic and defense ties.
During her stay in Japan, Tai met with Japanese Foreign Minister Yoshimasa Hayashi and discussed making supply chains more resilient and secure, the Japanese Foreign Ministry said in a statement.
She also met with the Minister of Economy, Trade and Industry Yasutoshi Nishimura. The trade ministry said the two also spoke about strengthening supply chains—an issue that gained urgency amid shortages of computer chips and other goods during the pandemic. They also discussed ways to cooperate in the protection of human rights in business, the ministry said.
Japan and the United States have set up a task force that aims to eliminate human rights violations in international supply chains and to ban use of materials from suppliers that subject their workers to inhumane conditions.
To highlight such efforts, Tai toured an outlet of outdoor equipment and clothing retailer Patagonia in Tokyo’s popular Shibuya shopping and business district.
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