WASHINGTON: US President Donald Trump on Thursday threatened to cut off ties with China in response to its role in spreading the coronavirus pandemic as relations between the two largest economies in the world went into a tailspin following a raft of punitive measures by Washington and counter-threats by Beijing.
The Trump administration on Friday moved to block shipments of semiconductors to China’s Huawei Technologies even as the US President confirmed he was directing withdrawal of billions of dollars of American pension fund investments in China. In turn, Beijing indicated it is readying countermeasures against U.S. companies like Apple, Boeing, Cisco and Qualcomm which have huge investments in China.
Following up his remark that he is not keen to meet or talk to China’s leader Xi Jinping at this point of time and a sense of betrayal he has felt, Trump has ordered a series of punitive measures while warning in a Fox Business interview that, “There are many things we could do. We could cut off the whole relationship.” Such a measure will decimate the global supply chain that is already under strain given not only the mutual dependency of the two largest economies in the world, but also other countries that are linked to them.
US lawmakers are also moving in tandem with Trump’s pressure on China, drawing up retributory legislation with steps ranging from barring Chinese students from studying STEM (science, technology, engineering, maths) in America to shoring up Washington’s alliances with countries surrounding China, including with India.
An 18-point plan unveiled on Friday by US Senator Thom Tillis “to hold the Chinese government accountable for its lies, deception, and cover-ups that ultimately led to the global COVID-19 pandemic” envisages steps to “deepen our military ties with regional allies and expand equipment sales to Taiwan, India, and Vietnam.”
The plan also calls for moving manufacturing back to the U.S. and gradually eliminating supply chain dependency on China, seeking restitution from the Chinese government and impose sanctions for lying about the virus, investigating the Chinese government’s cover-up of the spread of COVID-19, and exposing and countering China’s predatory debt-trap diplomacy targeting developing countries, among other measures.
The hardening Republican public stance on Beijing is also aimed at deflecting criticism of Trump’s initial softball reaction to the emergence of the coronavirus when he repeatedly praised China and its leader Xi Jinping for being transparent and being control of the virus. Some of his pronouncements have been compiled into a Democratic attack ad. Trump and his supporters meanwhile have lined up political ammunition to show that it was the Obama-Biden dispensation that allowed China to exploit the U.S.
But any expectation that the U.S-China spat could be beneficial to New Delhi in terms of US companies moving assembly lines to India has been spiked by Trump and US lawmakers who have warned that such companies would be taxed if they went elsewhere and did not bring back manufacturing to the U.S.
Asked about Apple moving some of its manufacturing from China to India, Trump said he initially gave Apple “a little bit of a break because they’re competing with a company that was a part of a trade deal that we made,” but “we’re not allowing this anymore.”
“You know if we wanted to put up our own border like other countries do to us, Apple would build 100 per cent of their product in the United States. That’s the way it would work,” he said. The U.S President has more once criticized India for what he believes is its high tariff barriers.
Proposals by Tillis and other lawmaker too envisage forcing companies to return to the U.S and keeping manufacturing in the country, even if means higher manufacturing costs.
Americans have been shaken in recent weeks to discover that in the middle of the pandemic, the country was heavily dependent on China and other countries for such basic medical supplies as masks, gloves, gowns, and swabs.
In a powerful presentation at a Congressional hearing on Thursday, one U.S manufacturer of medical equipment described how he had struggled for years to warn successive governments of the danger they were inviting as hospitals and companies in America abandoned U.S manufacturers in search of cheaper alternatives abroad.