May 2023 Volume 5

WASHINGTON UPDATE

Economic Coalitions Form: The World Wakes up to China By John Guzik

Few things unify politicians on both sides of the aisle inWashington, D.C. as does the People’s Republic of China. Even fewer issues are bringing politicians across the globe together than the economic threat that the Chinese Communist Party (CCP) poses. And the threat is real; just ask the Europeans who source 98 percent of their rare earth supplies fromChina. The U.S., European Union, and Japan are working to create an economic supply chain block that is not as easily described as East vs. West, but as democratic economies vs. communist or managed economies. Should the policies these governments are considering take effect, they could have the ability to alter global supply chains for decades to come, by both lowering barriers and raising them. Washington is leading an effort to block the export of certain manufactured goods and technologies to China, not only from the United States but also securing commitments from allies in an effort to isolate China and other “foreign adversaries.” This designation of a foreign adversary is gaining steam in U.S. Government circles as policymakers group China, Russia, North Korea, and Iran together as a group of countries to whom the Biden administration wants to restrict exports to and imports from in the coming months. As the Biden administration seeks to rally global allies into this new economic and technological coalition, the U.S. Congress is looking internally at how China is influencing American society, industry, and national security. In January 2023, Congress -- in a rare sign of bipartisanship -- established the House Select Committee on China to examine vulnerabilities in technology and national security and possibly make recommendations on how to address concerns with China. In a recent editorial, the Chairman of the Select Committee on China, U.S. Representative Mike Gallagher (R-WI) wrote that

the Committee would seek ways to “restore supply chains and end critical economic dependencies on China, strengthen the military, end the CCP’s theft of American personal data and intellectual property, and contrast the CCP’s techno-totalitarian state with the values of the Free World.” In just a few months since its establishment, the Committee has held several hearings to study Chinese aggression. In both the House and Senate, lawmakers from both parties introduced more than 120 bills to address the China threat including allowing the President to force the sale of foreign owned technologies, apps, and software (i.e., TikTok), and defend Taiwan’s security. The Fighting Trade Cheats Act, the Customs-Trade Partnership Against Terrorism Pilot ProgramAct, the American Innovation and Jobs Act, and China Grand Strategy Commission are just examples of a few China-related bills introduced this year. On March 27, 2023, the House unanimously passed by a vote of 415-0, the People’s Republic of China is Not a Developing Country Act. These types of votes are usually reserved for the non-controversial act of naming a post office, not making major policy decisions. FIA is working with lawmakers on both sides of the aisle to formulate legislation to address many of the concerns facing the forging industry and manufacturing sector more broadly. FIA members from across the country recently visited the White House and their Senators and members of Congress to urge them to reach out to the U.S. Trade Representative to keep the 25 percent tariffs in place. While Congress is considering China-related legislation, the Administration, separate from its global supply chain efforts, is debating whether to extend nearly 10,000 tariffs on Chinese products entering the U.S. Currently, the administration is reviewing nearly 1,500 comments filed by those supporting and

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FIA MAGAZINE | MAY 2023