Commerce Secretary Gina Raimondo testifies before a Senate Appropriations Subcommittee on Commerce, Justice, Science, and Related Agencies hearing on Capitol Hill in Washington, D.C., U.S., February 1, 2022.
Andrew Harnik | Reuters
It’s now clear to U.S. officials that China, once considered a possible economic and political ally, has grow to be an emerging threat to national security, U.S. corporations and American staff, Commerce Secretary Gina Raimondo said Wednesday.
“Over the past decade, China’s leaders have made clear that they don’t plan to pursue political and economic reform and are as a substitute pursuing an alternate vision of their country’s future,” Raimondo said in a speech on the Massachusetts Institute of Technology. “China’s reprioritization away from economic growth toward national security and its assertive military behavior signifies that now we have to rethink how we protect our national security interests while also promoting our interests in trade and investment.”
Raimondo said Chinese leaders have made it apparent over the past decade that “increasing the role of the state society and economy,” “constraining the free flow of capital” and “decoupling in technology areas of the longer term” is more vital than political and economic reform.
“Probably most disturbingly is that they’re accelerating their efforts to fuse economic and technology policies with their military ambitions,” Raimondo said. “And as China’s economy has grown in size and influence, so too, has its commitment to using nonmarket trade and investment practices in ways which are forcing us, compelling us, to defend United States businesses and staff and people of our allies and partners.”
Raimondo said China is attempting to game the worldwide system by stacking Chinese representatives on international technology standard-setting bodies to advertise the country’s values and spread its influence. She said it undermines good governance, puts U.S. corporations at a drawback “and puts in danger lots of our fundamental values, similar to the free flow of knowledge and data privacy.”
Raimondo’s speech comes about two weeks after President Joe Biden met for about three hours with Chinese President Xi Jinping before the G-20 summit in Indonesia where he objected to China’s growing aggression to neighboring Taiwan. The leaders pushed for a bilateral relationship amid rising tensions as a result of China’s intimidation of Taiwan.
Strict measures were implemented under the CHIPS and Science Act, signed into law by Biden in August, to make sure research and innovation investments “can never be used to profit China’s military,” said Raimondo. The administration fears that semiconductor chips used to fabricate military equipment could possibly be used against the U.S.
In October, the Biden administration imposed export restrictions on semiconductors manufactured in China by U.S. corporations. The Commerce Department also issued license restrictions on the export of certain chips that may be utilized in modern weapons systems and barred U.S. residents from working for China’s chip manufacturing industry.
Raimondo said the U.S. government seeks to outcompete China in shaping the worldwide economy and defend against an “increasing and emerging array of practices” geared toward U.S. staff and businesses and posing a threat to national security.
“China today poses a set of growing challenges to our national security,” she said. “That could be a fact. It’s deploying its military in ways in which undermine the safety of our allies and our partners and the free flow of world trade.”
But Raimondo also acknowledged that the U.S. advantages from the over $750 billion annual trade market with China, which is America’s third largest export market. Exports support over 750,000 American jobs amongst large and small industries, she said.
“We would like to proceed to advertise trade, proceed to advertise investment. But in areas that haven’t any potential to undermine our interests, our values, our national security, our economic security, and at the identical time using every tool in our toolbox to guard our corporations and counter unfair economic practices,” Raimondo said.
