I wrote a piece over at China Trade Monitor (still free for now!) on Katherine Tai's speech from yesterday and the Biden administration's developing China trade policy. Here's the intro and conclusions:
After months of saying that they are reviewing their China trade policy, the Biden administration has, through a speech by U.S. Trade Representative Katherine Tai at CSIS, an interview with Tai on CNBC, and remarks made on background by senior administration officials, offered some details on the direction they plan to go. Four key aspects of their agenda are: 1) Enforcement of the U.S.-China Phase One trade agreement; 2) restarting the Section 301 tariff exclusions process; 3) reengaging with senior Chinese trade officials; and 4) working with allies on the trading system in general and on an approach to China. To some extent, the Biden administration's statements seem like a continuation of the existing U.S. trade policy towards China (although Biden administration officials emphasized that they view the Trump administration's approach as flawed and their approach would be different in important ways). However, they could be taken as a tentative, though belated, first step towards a post-Trump U.S. trade policy towards China.
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The Biden administration's announcements on its China trade policy probably could have come a lot sooner. However, the administration was caught up with various domestic policy issues; it is still in the process of getting its full USTR team in place; and it has a difficult task in formulating a coherent and effective policy in this area. The pressure from various sources to do or say something may have pushed them to offer the general outlines of the policy described above. What we heard from Katherine Tai and other officials are the first tentative steps towards a policy that will continue to be fleshed out over the coming months and years. The immediate step appears to be that the Biden administration will raise these issues with China, and see how China reacts. It is that reaction that may determine the next steps the Biden administration takes in this area.
Basically, they will raise a bunch of concerns with China (mostly through the Phase One agreement, but perhaps elsewhere as well) and see what China has to say. I think there will be problems with doing this under the Phase One agreement (lack of transparency, a flawed enforcement mechanism), but that's what they want to use and we'll see how it goes.
