June 14, 2021
This Week in Trade for June 11
Last Week (June 7 — 11)
Senate Advances China Competition Bill. The Senate June 8 approved 68-32 the United States Innovation and Competition Act of 2021 (S.1260), which includes a number of China-focused bills including the Endless Frontiers Act (bolstering U.S. research), $52 billion in emergency subsidies for domestic production of semiconductor chips as well as legislation to renew the Generalized System of Preferences (GSP) and Miscellaneous Tariff Bill (MTB) trade programs. The rare bipartisan Senate package reflects increasing concern among policymakers with the U.S. ability to compete economically with China. Nevertheless, House prospects for a similar bill remain uncertain at the moment.
White House Unveils Supply Chain Report. The White House June 8 released a report detailing its recommendations following a 100-day review of supply chain issues related to four key sectors: semiconductor chips, EV batteries, pharmaceuticals and rare earth minerals. The report stated: "private sector and public policy prioritization of low-cost labor, just-in-time production, consolidation, and private sector focus on short-term returns over long-term investment have hollowed out the U.S. industrial base, siphoned innovation from the United States, and stifled wage and productivity growth." The White House is also conducting a broader study of supply chain resiliency issues, expected to take one year, focusing on six key sectors: the defense; public health; information and communications technology; energy; transportation; and agricultural. The 100-Day Report made a wide range of recommendations, including establishing a White House Supply Chain Disruptions Task Force as well as establishing a public-private consortium for advanced manufacturing and onshoring of domestic essential medicines production. In addition, the White House report mandated the establishment of a USTR-led "Trade Strike Force" to combat foreign trade practices resulting in supply chain disruptions to the U.S. economy.
Biden to Huddle with G-7, EU Leaders in First Foreign Trip. President Biden traveled this week to the UK to meet with G-7 leaders to be followed by a Brussels meeting with EU leaders. Following these meetings, the President was slated to meet next week with Russian President Vladimir Putin, in their first face-to-face meeting since the November election. Trade was expected to be a central topic of the G-7 and EU meetings. USTR Katherine Tai was expected to join the President in his meetings with hope that progress can be made in resolving some outstanding U.S.-EU trade disputes, including the long-running civil aircraft subsidies dispute as well as tariffs related to steel imports.
Biden Revokes Trump TikTok Ban. The White House June 9 revoked an Executive Order issued last year that sought to ban the use of Chinese apps TikTok and WeChat in the United States. The White House issued a new Executive Order setting up a new criteria-based decision framework and rigorous, evidence-based analysis to address the risks posed by China-developed software applications that may present an undue national security risk.