White House prepares major shift in US-China trade policy

U.S. Trade Representative Katherine Tai will call Wednesday for a major shift in the United States's relationship with China, as the White House has concluded Beijing has not followed through on past trade agreements.

Tai will testify before the House Committee on Ways and Means, where she will advocate the U.S. adopting what is being described as a defensive economic posture rather than continuing with the Phase One trade deal brokered between the Trump administration and Beijing, according to prepared remarks reviewed by the Washington Examiner .

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"While we continue to keep the door open to conversations with China, including on its Phase One commitments, we also need to acknowledge the agreement’s limitations, and turn the page on the old playbook with China, which focused on changing its behavior," she will state. "Instead, our strategy must expand beyond only pressing China for change and include vigorously defending our values and economic interests from the negative impacts of the PRC’s unfair economic policies and practices."

Though COVID-19 labor shortages prevented China from meeting the agriculture commitments outlined by the Trump administration, President Joe Biden opted in 2021 to work with the Chinese government on fulfilling the Phase One deal.

Tai said the Biden administration looked "to fight for the farmers and businesses that benefit from those obligations and test how committed the PRC was to the obligations it signed up to."

However, data published in January showed the U.S. trade deficit with China rise from $310 billion to $355 billion in 2021.

"Over time, it became clear that the PRC would only comply with those trade obligations that fit its own interests. This is a familiar pattern with the PRC — from their actions at the WTO and in various bilateral high-level dialogues," her Wednesday remarks continue. "The United States has repeatedly sought and obtained commitments from China, only to find that follow-through or real change remains elusive."

Tai additionally notes that China is "targeting critical industrial and high-tech sectors, like electric vehicles, batteries, semiconductors, and others," and will call on the U.S. to invest in and develop those same economic interests by passing the Biden-endorsed Bipartisan Innovation Act.

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You can stream Tai's entire appearance before the committee below.