Commerce Secretary Gina Raimondo: 'We need to keep our defenses up' on China
The U.S. will keep Chinese telecom giant Huawei on a trade blacklist, take no immediate action toward social media platform TikTok, and continue to evaluate tariffs, Commerce Secretary Gina Raimondo told Yahoo Finance on Thursday in a wide-ranging conversation about U.S. policy toward China.
Raimondo outlined an urgent U.S. economic response to China that includes significant domestic investment as well as defensive action against Chinese companies that threaten U.S. security.
“We need to keep our defenses up,” she told Yahoo Finance’s editor-in-chief, Andy Serwer.
The policy comes as global chip shortage caused by supply chain disruptions in Asia slows U.S. economic production and heightens tension with China.
The Biden administration in February shelved plans to force the sale of TikTok’s American operations to a group of U.S. companies including Oracle (ORCL) and Walmart (WMT), the Wall Street Journal reported. But the company remains under evaluation by the Committee on Foreign Investment for potential national security threats.
Meanwhile, Huawei will keep its place on the U.S. entities list, which prohibits the sale of critical technologies to the company, Raimondo said. In a sign of its ongoing concern, the Commerce Department added seven Chinese supercomputing entities to that list last month.
“I have no news to break on TikTok,” Raimondo says. “Huawei remains on the entities list, and there’s no reason to think that they’ll be coming off.”
“Since I have been here in the job, we’ve put another five or six Chinese companies on the entities list, including a computing company,” she adds. “So I think we need to keep our defenses up.”
Tariffs worldwide remain under ‘evaluation’
President Joe Biden on Friday will urge South Korea President Moon Jae-in to sign a forceful statement of concern about China during the foreign leader’s visit to Washington, where South Korean business leaders are also expected to announce investments in U.S. semiconductors, the Financial Times reports.
The move marks the latest step in the U.S. economic response to China, which includes a bill making its way through the Senate that calls for a $120 billion investment in the U.S. technology sector to compete with China.
At least for now, the Biden administration has carried over several key China policies from the Trump administration, which started the trade war with China. Tariffs on Chinese goods remain in place and the U.S. reaffirmed its label of the Chinese government’s mass detention of minority Uighur citizens as “genocide.”
Speaking to Yahoo Finance, Raimondo said U.S. tariffs on countries worldwide remain under “evaluation.”
Leaders from the U.S. and China have exchanged firm public statements in recent weeks, escalating a rivalry between the world’s two strongest economies.
Last month, Chinese President Xi Jinping took an emboldened posture toward the U.S. Speaking to a virtual gathering of leaders in business and government at the Boao Forum for Asia, he warned: “Bossing others around and interfering in other countries’ internal affairs will not be well received.”
While Xi did not mention the U.S. by name, the remark was widely perceived to be directed at the country.
Meanwhile, Biden has struck a firm but measured tone toward China, acknowledging economic and diplomatic challenges posed by the country while avoiding sharply inflammatory rhetoric. The approach marks a departure from former President Donald Trump, who repeatedly blamed the coronavirus outbreak on China, referring disparagingly to the disease as the “China virus.”
When asked by Yahoo Finance Editor-in-Chief Andy Serwer whether the U.S. economic response to China should include an offensive approach of domestic investment or a defensive posture that protects against Chinese companies, Raimondo says, “You definitely need both.”
She pointed to the Biden administration’s $2 trillion infrastructure proposal, The American Jobs Plan, as an example of U.S. investment that can help address the economic threat posed by China.
“The president’s jobs package is a lot of offense, and I think we need every bit of it,” she says.