Transition 2020 | Biden and Trade: Countering – and Potentially Cooperating with – China
For the past four years, the Trump Administration has pursued a relentless strategy against the People’s Republic of China (“China”) that can be best described as “chaotic pressure.” The Biden Administration will likely keep up the pressure, but apply it more predictably.
At a high level, President-Elect Biden will likely continue many of President Trump’s China policies. Too much has changed for the US to immediately revert to pre-2017 norms. Attitudes in Washington have shifted, and both parties generally agree that the US must be more aggressive than it has historically been when confronting and countering China. The Biden Administration will continue pressuring China on trade, economic practices, and human rights, and maintain many of President Trump’s major China policies.
However, tariff relief may be on the table. It would be politically difficult for the Biden Administration to roll back President Trump’s Section 301 tariffs on China immediately and fully. Instead, officials could look for opportunities to gradually remove or reduce the tariffs. This could be effected as part of an agreement with China to restart trade talks, or as part of a targeted stimulus package. US courts could also play a role in reducing these tariffs. The Court of International Trade is currently considering thousands of challenges to List 3 and List 4A of the Section 301 tariffs, and if the plaintiffs succeed, a Biden Administration could choose to not mount a robust appeal. These two lists include the vast majority of products from China covered by the Trump tariffs, and a wide range of industries would welcome removal of duties on these goods.
President-Elect Biden will be more likely than President Trump to publicly criticize China for its alleged human rights abuses. Despite demonstrating a reluctance to do so, President Trump’s Administration has levied significant sanctions on Chinese individuals and institutions for actions related to Hong Kong, North Korea, and the treatment of Uyghurs in Xinjiang. We expect the Biden Administration to continue enforcing US sanctions laws against Chinese individuals and entities and better coordinate messaging on human rights across the Executive Branch.
President-Elect Biden will prioritize a multilateral strategy to counter China, especially with Indo-Pacific allies. However, President-Elect Biden is unlikely to immediately re-engage the US in discussions to join the Trans-Pacific Partnership (TPP), the regional trade agreement negotiated by former US President Barack Obama and from which President Trump withdrew the US early in his term, having pledged to seek changes first.
Perhaps most notably, President-Elect Biden may look for opportunities for bilateral cooperation with China. Over the past four years, President Trump has shied away from working with other countries to address global challenges. The Biden Administration, by contrast, will look for opportunities to reassert US leadership in multilateral engagement, which could include close cooperation between Washington and Beijing on issues such as the COVID-19 pandemic, climate change, and nuclear nonproliferation. The Biden Administration may also seek to establish formal, high-level ministerials with Beijing (similar to the dialogues held throughout the Bush and Obama Administrations) and may seek new trade talks to build upon the Trump Administration’s Phase One deal.
Finally, Congress will be eager to act on China. House and Senate lawmakers introduced over 400 China-related pieces of legislation in the 116th Congress, and are likely to introduce a similarly high number of bills in the 117th Congress. Lawmakers recently introduced two comprehensive China bills – one penned by Democrats in the Senate (S. 4629, the America LEADS Act) and the other by Republicans in the House (H.R. 12, the China Task Force Act). These bills are similar and demonstrate Congress will remain focused on China in 2021 .