China’s tariffs are a major source of leverage, says Biden’s top retailer

Lawmakers on Wednesday pressured President Biden’s top negotiator on the administration’s trade strategy toward China, including what, if anything, Mr. Biden was planning to do about tariffs on Chinese goods imposed by his predecessor.

The Biden administration has been under pressure to reduce some or all rates as a way to help deal with inflation, which is running at its fastest pace in 40 years. Katherine Tai, the U.S. Trade Representative, told lawmakers that a decision on tariffs and other actions against China would “stick” with the president. But she also defended the importance of the levies, calling them “an important piece of leverage” in relations with China, saying there was a limit to what could be done to address short-term challenges such as inflation.

“A trade negotiator never goes away from leverage,” she said.

Mr. Biden has weighed a decision to lift some of the levies levied on more than $ 360 billion in goods produced in China, including some consumer products. Proponents of her case have been working to make the actual transcript of this statement available online.

But those who support the tariffs say reducing them would remove a barrier aimed at protecting U.S. industry from cheap Chinese products. They also point to the fact that China has not fulfilled all the promises it made to the United States as part of a 2020 trade agreement reached during the Trump administration, including an agreement for an additional $ 200 billion to US soybeans. , to buy aircraft, energy and other products by the end of 2021.

When asked on Tuesday whether he would talk to Chinese leader Xi Jinping before making a decision on tariffs, Mr. Biden said he planned to have a conversation, but noted that “we have not set a time yet.”

Ms. Tai told lawmakers on Wednesday that she saw it as worthwhile to hold talks with the Chinese regarding their performance under the trade agreement, given that “China is making international credibility.” But she noted, “that has not been enough to motivate China to make these purchasing commitments particularly good.”

“That’s what leads us to conclude that it’s time to turn the old drama book around,” she said. “We must uphold our rights regarding China, and we must defend the interests of our entire economy.”

Ms. Tai described China as having a state-driven economic model that made it possible to direct and take over the entire strategic industry. This approach was found to be fundamentally incompatible with the more market-driven U.S. economy, she said.

With respect to reducing rates, she said, “we need to keep our eye on the ball on this bigger picture.”

She said it was the administration’s responsibility to provide assistance for “the economic challenges and hardships” facing Americans. But they implied that maintaining tariffs would be a more effective tool in the long run to maintain the competitiveness of the United States against China.

“We can affect the competitiveness of our economy in the medium and long term,” she said. “With respect to short-term challenges, there is a limit to what we can do with respect for, in particular, inflation.”

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