US pushes to rip supply chains from China

Trump weighs new tariffs to punish Beijing for its handling of virus


Reuters May 05, 2020
PHOTO: REUTERS

WASHINGTON: The Trump administration is “turbo-charging” an initiative to remove global industrial supply chains from China as it weighs new tariffs to punish Beijing for its handling of the coronavirus outbreak, according to officials familiar with US planning.

President Donald Trump, who has stepped up recent attacks on China ahead of the November 3 US presidential election, has long pledged to bring manufacturing back from overseas.

Now, economic destruction and the massive US coronavirus death toll are driving a government-wide push to move US production and supply chain dependency away from China, even if it goes to other more friendly nations instead, current and former senior US administration officials said.

“We’ve been working on (reducing the reliance of our supply chains in China) over the last few years but we are now turbo-charging that initiative,” Keith Krach, Undersecretary for Economic Growth, Energy and Environment at the US State Department told Reuters.

The US Commerce Department, State and other agencies are looking for ways to push companies to move both sourcing and manufacturing out of China.

Tax incentives and potential re-shoring subsidies are among measures being considered to spur changes, the current and former officials said. “There is a whole of government push on this,” said one. Agencies are probing which manufacturing should be deemed “essential” and how to produce these goods outside of China.

Trump’s China policy has been defined by behind-the-scenes tussles between pro-trade advisers and China hawks - now the latter say their time has come.

Published in The Express Tribune, May 5th, 2020.

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