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    Biden Sells Infrastructure Improvements as a Way to Counter China

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    Spending on roads, broadband internet and more will help revitalize U.S. competitiveness against its top economic adversary, the president says.President Biden said the newly signed infrastructure law would help the United States counter China in the battle to dominate the 21st-century economy, as broad swaths of his agenda remained stuck in Congress.Kenny Holston for The New York TimesWASHINGTON — President Biden on Tuesday began selling his $1 trillion infrastructure law, making the case that the money would do more than rebuild roads, bridges and railways. The law, he said, would help the United States regain its competitive edge against China.“We’re about to turn things around in a big way,” Mr. Biden said in remarks at a bridge over the Pemigewasset River, in snowy New Hampshire. “For example, because of this law, next year will be the first year in 20 years that American infrastructure investment will grow faster than China’s.”The president has cast the legislation as a giant leap for the United States in its battle with China to dominate the 21st-century economy, even though it does not include the full scope of his campaign promises to pour money into research and development and provide incentives for domestic manufacturing and other initiatives.“It’s an important step, although it’s not a huge one, if one thinks about the progress China has made in building up its physical and soft infrastructure,” said Eswar S. Prasad, an economist at Cornell University who specializes in trade policy. The infrastructure law “is a good defensive measure,” he added. “But will it fundamentally alter the dynamics? Not by itself.”Even as his administration begins spending the money in the law to upgrade bridges, broadband internet, water pipes and more, broad swaths of Mr. Biden’s agenda to compete economically with the Chinese remain stuck in Congress. A bill to significantly increase federal research and development spending on advanced batteries, semiconductors and other high-tech industries — which the president was forced to drop from his initial infrastructure proposal — has cleared the Senate but not the House, though administration officials expect it to eventually pass.Mr. Biden’s additional plans to stimulate more low-emissions energy production, including hundreds of billions of dollars in tax incentives, hinge on passage of a $1.85 trillion spending bill that Democrats have yet to find consensus on. That bill also contains spending on early childhood education, child care and other support for the work force that economists say will help the United States bolster the skills and productivity of its workers.If the president can shepherd those two bills through Congress, analysts say, he could have a foundation for a U.S. industrial policy that rivals Chinese investments in manufacturing and advanced technology. If he cannot, he will still have better transportation, energy and information sectors domestically, but his efforts to counter China will be incomplete.Chinese commentators have taken notice. An editorial this month in Global Times, a popular tabloid controlled by the country’s Communist Party, called the infrastructure bill a “feeble imitation of China” and said it was “tantamount to a fairy tale” that the measure alone would revitalize U.S. competitiveness.Mr. Biden has leaned into the issue as he sells Americans on the benefits of the law. Hours before he met virtually with President Xi Jinping of China on Monday, during a signing ceremony with hundreds of attendees at the White House, Mr. Biden put the countries’ economic rivalry front and center.“I truly believe that 50 years from now,” he said, “historians are going to look back at this moment and say, ‘That’s the moment America began to win the competition of the 21st century.’”Brian Deese, the director of Mr. Biden’s National Economic Council, said in an interview that the law would increase competitiveness and productivity through a variety of spending programs.“This bill is going to be a game-changer in getting Americans to work,” Mr. Deese said.He added that it would allow people to gain access to economic opportunities through better public transportation, roads and bridges, and provide high-speed internet, which he called “the lifeblood of the 21st-century economy.”China’s large investments in its own infrastructure, and its threat to U.S. dominance in new and longstanding global industries, loomed large over the congressional negotiations that produced the law. Democratic and Republican lawmakers are more attuned than ever to Chinese spending, thanks to Mr. Biden and President Donald J. Trump, who both put competition with China at the center of their presidential campaigns last year.Understand U.S.-China RelationsCard 1 of 6A tense era in U.S.-China ties. More

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    Pastries and Persuasion: How a Global Tax Deal Got Done

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    Over Zoom calls from basements and a breakfast in Brussels, faltering negotiations to remake the world’s tax architecture were revived.WASHINGTON — Over a two-hour breakfast of tea and pastries at the Hotel Amigo in Brussels in July, Treasury Secretary Janet L. Yellen tried to persuade Paschal Donohoe, the Irish finance minister, to abandon Ireland’s rock bottom corporate tax rate and join the global deal the Biden administration was racing to clinch.The closing pitch was simple: Ireland cannot go back in time. The days of American companies moving their headquarters to Ireland for tax purposes were largely over, and more than 100 countries had already agreed in principle to join the agreement.That meeting kicked off a three-month push to hash out the most sweeping changes to the international tax system in a century, which culminated in an agreement that President Biden and other leaders of the Group of 20 nations are expected to complete this week in Rome. The deal has become crucial to Mr. Biden’s domestic agenda, with the White House and Democrats in Congress now relying on revenue from a new 15 percent global minimum tax and other changes to help pay for the expansive spending package still being negotiated.Getting to yes was not easy. In the end, the United States had to convince Ireland that its economy would be better off raising its cherished 12.5 percent corporate tax rate and joining rather than remaining a tax haven and leaving the global tax system under a cloud of uncertainty. With the European Union needing all 27 nations to be on board, the pressure was on to get Ireland to come around.Officials from countries involved in the negotiations said the outcome was not clear until hours before the Organization for Economic Cooperation and Development announced on Oct. 8 that Ireland and two other holdouts — Estonia and Hungary — had joined the pact.Nearly 140 countries agreed to adopt a global minimum tax of 15 percent and settled on terms to tax large, profitable multinational corporations based on where their goods and services are sold, rather than where they operate. The agreement aims to end corporate tax havens that have for decades siphoned tax revenue away from governments, leaving infrastructure and public health needs languishing.“I think the world had come to understand that at the end of the day, all the countries trying to raise tax revenue are the losers, the companies are the winners, and the workers are the losers,” Ms. Yellen said in an interview on Tuesday. “No country really feels it can act independently to raise taxes because its firms will be uncompetitive, so the only way to do this is to hold hands and say enough is enough.”The deal is a signature achievement for Ms. Yellen, who has spent the past eight months trying to persuade nations to agree on a global tax pact that sputtered during the Trump administration.The push to reach a deal stemmed from the administration’s concerns about a global race to the bottom on corporate taxation, a phenomenon that was viewed as a big obstacle to Mr. Biden’s plan to increase corporate taxes domestically.The administration viewed persuading the rest of the world to set a global minimum tax as crucial to its own plans to raise the corporate tax rate to 28 percent, since that would minimize any competitive disadvantage. The Treasury Department estimated that its international tax plans could raise $700 billion in tax revenue over a decade.To show that the new administration was taking the negotiations seriously, Ms. Yellen told her counterparts in February that she was abandoning a Trump administration stance that would have effectively blocked other countries from imposing new taxes on American companies. She offered a plan that would allow the world’s richest companies, regardless of where they are based, to face new taxes in exchange for the removal of digital services taxes.“It had been a show stopper in these negotiations that had been going on for many years,” Ms. Yellen said.The next big obstacle was settling on a rate. The United States wanted a minimum tax of 21 percent, very likely a nonstarter for a country such as Ireland, which has relied on its 12.5 percent tax rate to attract international investment. In May, the United States agreed to continue negotiations on the basis that the rate would be “at least” 15 percent — while hoping to nudge it higher.“The turning point has been the support of the American administration,” Bruno Le Maire, France’s finance minister, told The New York Times this month.Mr. Grinberg, a tax law professor at Georgetown University, worked in the Treasury Department during the Bush and Obama administrations.Lexey Swall for The New York TimesTo get the deal over the finish line, Ms. Yellen relied on two tax experts, Itai Grinberg and Rebecca Kysar, whom she tapped in early February and describes as “invaluable” partners in navigating international negotiations.Mr. Grinberg, a tax law professor at Georgetown University who worked in the Treasury Department during the Bush and Obama administrations, was initially viewed with skepticism by some progressives, who noted that in 2016 and 2017, he lamented America’s “singularly high corporate tax rate” during congressional hearings and called for the rate to be slashed in favor of a consumption tax.But in early 2020, Mr. Grinberg wrote in a Foreign Affairs essay that European digital services taxes could open a dangerous front in the Trump administration’s tariff wars and warned that the “decay of the century-long international tax order is likely to accelerate” without a deal. Later that year, Mr. Grinberg alerted Mr. Biden’s campaign advisers on how their international tax proposals meshed with the stalled discussions of a global minimum tax. After the election, he joined Mr. Biden’s transition team.Ms. Kysar, a professor at the Fordham School of Law and a tax treaty expert, has been a vocal critic of the 2017 Republican tax overhaul. In 2018, she told the Senate Finance Committee that the law’s international tax provisions “fundamentally botched general business taxation.” Ms. Kysar had collaborated on research with David Kamin, deputy director of the White House’s National Economic Council, who helped recruit her to join the transition team and administration.With the Treasury Department working remotely, Mr. Grinberg and Ms. Kysar spent months juggling Zoom meetings with officials from finance ministries around the world and fielding calls with tax directors from America’s largest companies, which have been anxious about what the agreement will mean for their tax bills.Working from their basements in Washington and Connecticut, they regularly exchanged emails in real time during negotiations, but they had never met until they traveled to a gathering of finance ministers in Venice in July. At such summits, they would often employ a divide and conquer approach, with Ms. Kysar joining Ms. Yellen in meetings with her counterparts and Mr. Grinberg negotiating separately with Irish tax officials.The final months of negotiations centered on the United States and Ireland, but with moving parts falling in and out of place from Peru to India, which threatened to back out of the deal shortly ahead the announcement.Ms. Yellen’s approach with Ireland was to cajole more than to pressure.“Where once upon a time this tax advantage may have been important to Ireland, Ireland has built a really strong economy with a very well educated labor force,” Ms. Yellen said. “It is an extremely attractive base for American multinationals to choose as their E.U. headquarters.”In a call with Ms. Yellen in early September, Mr. Donohoe said that the deal hinged on the United States agreeing to drop language suggesting the rate could be higher than 15 percent.Ms. Yellen signed off on removing the “at least” 15 percent language, yet what Mr. Donohoe would do was still not clear. That was, until Oct. 7, when he called Ms. Yellen and Ms. Kysar to say that Ireland was in.Ms. Kysar, a professor at the Fordham School of Law , is an expert in international tax treaties.Lexey Swall for The New York Times“Ireland is a country that believes that smaller economies like our own do need to be competitive,” Mr. Donohoe said in an interview. “But we also know that for economies like our own, for societies like our own, we deeply value cooperation, we deeply value compromise.”To demonstrate American solidarity, Ms. Yellen will visit Dublin next month.The next steps could be even more challenging. A deal among countries does not mean there is agreement within those nations, including the United States, which will need to change America’s tax code and potentially rewrite tax treaties to comply with the agreement. That could require Republican support, which is not guaranteed. Top House and Senate Republicans have assailed the pact, calling the deal a “surrender.” More

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    As Western Oil Giants Cut Production, State-Owned Companies Step Up

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    In the Middle East, Africa and Latin America, government-owned energy companies are increasing oil and natural gas production as U.S. and European companies pare supply because of climate concerns.HOUSTON — After years of pumping more oil and gas, Western energy giants like BP, Royal Dutch Shell, Exxon Mobil and Chevron are slowing down production as they switch to renewable energy or cut costs after being bruised by the pandemic.But that doesn’t mean the world will have less oil. That’s because state-owned oil companies in the Middle East, North Africa and Latin America are taking advantage of the cutbacks by investor-owned oil companies by cranking up their production.This massive shift could reverse a decade-long trend of rising domestic oil and gas production that turned the United States into a net exporter of oil, gasoline, natural gas and other petroleum products, and make America more dependent on the Organization of the Petroleum Exporting Countries, authoritarian leaders and politically unstable countries.The push by governments to increase oil and gas production means it could take decades for global fossil fuel supplies to decline unless there is a sharp drop in demand for such fuels. President Biden has effectively accepted the idea that the United States will rely more on foreign oil, at least for the next few years. His administration has been calling on OPEC and its allies to boost production to help bring down rising oil and gasoline prices, even as it seeks to limit the growth of oil and gas production on federal lands and waters.The administration’s approach is a function of two conflicting priorities: Mr. Biden wants to get the world to move away from fossil fuels while protecting Americans from a spike in energy prices. In the short run, it is hard to achieve both goals because most people cannot easily replace internal-combustion engine cars, gas furnaces and other fossil fuel-based products with versions that run on electricity generated from wind turbines, solar panels and other renewable sources of energy.Western oil companies are also under pressure from investors and environmental activists who are demanding a rapid transition to clean energy. Some U.S. producers have said they are reluctant to invest more because they fear oil prices will fall again or because banks and investors are less willing to finance their operations. As a result, some are selling off parts of their fossil fuel empires or are simply spending less on new oil and gas fields.That has created a big opportunity for state-owned oil companies that are not under as much pressure to reduce emissions, though some are also investing in renewable energy. In fact, their political masters often want these oil companies to increase production to help pay down debt, finance government programs and create jobs.Saudi Aramco, the world’s leading oil producer, has announced that it plans to increase oil production capacity by at least a million barrels a day, to 13 million, by the 2030s. Aramco increased its exploration and production investments by $8 billion this year, to $35 billion.“We are capitalizing on the opportunity,” Aramco’s chief executive, Amin H. Nasser, recently told financial analysts. “Of course we are trying to benefit from the lack of investments by major players in the market.”Aramco not only has vast reserves but it can also produce oil much more cheaply than Western companies because its crude is relatively easy to pump out of the ground. So even if demand declines because of a rapid shift to electric cars and trucks, Aramco will most likely be able to pump oil for years or decades longer than many Western energy companies.“The state companies are going their own way,” said René Ortiz, a former OPEC secretary general and a former energy minister in Ecuador. “They don’t care about the political pressure worldwide to control emissions.”State-owned oil companies in Kuwait, the United Arab Emirates, Iraq, Libya, Argentina, Colombia and Brazil are also planning to increase production. Should oil and natural gas prices stay high or rise further, energy experts say, more oil-producing nations will be tempted to crank up supply.The global oil market share of the 23 nations that belong to OPEC Plus, a group dominated by state oil companies in OPEC and allied countries like Russia and Mexico, will grow to 75 percent from 55 percent in 2040, according to Michael C. Lynch, president of Strategic Energy and Economic Research in Amherst, Mass., who is an occasional adviser to OPEC.If that forecast comes to pass, the United States and Europe could become more vulnerable to the political turmoil in those countries and to the whims of their rulers. Some European leaders and analysts have long argued that President Vladimir V. Putin of Russia uses his country’s vast natural gas reserves as a cudgel — a complaint that has been voiced again recently as European gas prices have surged to record highs.A pump jack in Stanton, Texas. American companies have been cautiously holding back exploration and production.Brandon Thibodeaux for The New York TimesOther oil and gas producers like Iraq, Libya and Nigeria are unstable, and their production can rise or fall rapidly depending on who is in power and who is trying to seize power.“By adopting a strategy of producing less oil, Western oil companies will be turning control of supply over to national oil companies in countries that could be less reliable trading partners and have weaker environmental regulations,” Mr. Lynch said.An overreliance on foreign oil can be problematic because it can limit the options American policymakers have when energy prices spike, forcing presidents to effectively beg OPEC to produce more oil. And it gives oil-producing countries greater leverage over the United States.“Today when U.S. shale companies are not going to respond to higher prices with investment for financial reasons, we are depending on OPEC, whether it is willing to release spare production or not,” said David Goldwyn, a senior energy official in the State Department in the Obama administration. He compared the current moment to one in 2000 when the energy secretary, Bill Richardson, “went around the world asking OPEC countries to release spare capacity to relieve price pressure.”This time, state-owned energy companies are not merely looking to produce more oil in their home countries. Many are expanding overseas.In recent months, Qatar Energy invested in several African offshore fields while the Romanian national gas company bought an offshore production block from Exxon Mobil. As Western companies divest polluting reserves such as Canadian oil sands, energy experts say state companies can be expected to step in.“There is a lot of low-hanging fruit state companies can pick up,” said Raoul LeBlanc, an oil analyst at IHS Markit, a consulting and research firm. “It is a huge opportunity for them to become international players.”Kuwait announced last month that it planned to invest more than $6 billion in exploration over the next five years to increase production to four million barrels a day, from 2.4 million now.This month, the United Arab Emirates, a major OPEC member that produces four million barrels of oil a day, became the first Persian Gulf state to pledge to a net zero carbon emissions target by 2050. But just last year ADNOC, the U.A.E.’s national oil company, announced it was investing $122 billion in new oil and gas projects.Iraq, OPEC’s second-largest producer after Saudi Arabia, has invested heavily in recent years to boost oil output, aiming to raise production to eight million barrels a day by 2027, from five million now. The country is suffering from political turmoil, power shortages and inadequate ports, but the government has made several major deals with foreign oil companies to help the state-owned energy company develop new fields and improve production from old ones.Even in Libya, where warring factions have hamstrung the oil industry for years, production is rising. In recent months, it has been churning out 1.3 million barrels a day, a nine-year high. The government aims to increase that total to 2.5 million within six years.National oil companies in Brazil, Colombia and Argentina are also working to produce more oil and gas to raise revenue for their governments before demand for oil falls as richer countries cut fossil fuel use.After years of frustrating disappointments, production in the Vaca Muerta, or Dead Cow, oil and gas field in Argentina has jumped this year. The field had never supplied more than 120,000 barrels of oil in a day but is now expected to end the year at 200,000 a day, according to Rystad Energy, a research and consulting firm. The government, which is considered a climate leader in Latin America, has proposed legislation that would encourage even more production.“Argentina is concerned about climate change, but they don’t see it primarily as their responsibility,” said Lisa Viscidi, an energy expert at the Inter-American Dialogue, a Washington research organization. Describing the Argentine view, she added, “The rest of the world globally needs to reduce oil production, but that doesn’t mean that we in particular need to change our behavior.” More

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    U.S. Signals Little Thaw in Trade Relations With China

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    The Biden administration said it would not immediately remove the Trump administration’s tariffs and would require that Beijing uphold its trade commitments.WASHINGTON — The Biden administration offered its strongest signal yet that the United States’ combative economic approach toward China would continue, with senior administration officials saying that President Biden would not immediately lift tariffs on Chinese goods and that he would hold Beijing accountable for trade commitments agreed to during the Trump administration.The comments, in a call with reporters on Sunday, provided one of the first looks at how the Biden administration plans to deal with a rising economic and security threat from China. They indicated that while Mr. Biden may have criticized the Trump administration’s aggressive approach, his White House will continue trying to counter China’s economic threats with trade barriers and other punitive measures.That includes requiring China to uphold commitments it agreed to as part of the Phase 1 trade deal that it signed with the United States in January 2020. So far, China is on pace to fall short of its 2021 purchasing commitments by more than 30 percent, after falling short by more than 40 percent last year, according to Chad P. Bown, a senior fellow at the Peterson Institute for International Economics, who tracks the purchases.However, in a move that would offer some relief to businesses that import Chinese products, the administration said it would re-establish an expired process that gives some companies a reprieve by excluding them from the tariffs. Trade officials would make those decisions based on the priorities of the Biden administration, officials said, without elaborating further.Katherine Tai, the United States trade representative, is expected to begin talking with her Chinese counterparts in the coming days about the country’s failure to live up to its agreements, senior administration officials said. Officials did not rule out the possibility of imposing further tariffs on China if talks with did not produce the desired results, warning Beijing that they would use all available tools to defend the United States from state-directed industrial policies that harm its workers.China denies that it has failed to live up to the Phase 1 agreement, contending that the pandemic has created unique circumstances.The Biden administration has been drawing up an investigation into China’s use of subsidies under Section 301 of U.S. trade law. If it is carried out, that inquiry could result in additional tariffs on China, according to people familiar with the plans.In excerpts that were released on Monday morning in Washington from a planned speech later in the morning, Ms. Tai said that, “For too long, China’s lack of adherence to global trading norms has undercut the prosperity of Americans and others around the world.”“We continue to have serious concerns with China’s state-centered and nonmarket trade practices that were not addressed in the Phase 1 deal,” she added.Last week, Gina Raimondo, the commerce secretary, pointed to China’s blocking of its airlines from buying “tens of billions of dollars” of products from Boeing.“The Chinese need to play by the rules,” Ms. Raimondo said in an interview with NPR last week. “We need to hold their feet to the fire and hold them accountable.”The Biden administration has given no indication that it plans to lower the hefty tariffs that President Donald J. Trump placed on Chinese goods anytime soon, despite protests by economists and some businesses that they have dragged on the U.S. economy.Mr. Biden has frequently criticized Mr. Trump’s 18-month trade war with China as erratic and counterproductive. But more than eight months into his presidency, Mr. Biden has announced few policies that differentiate his approach. In addition to the tariffs on Chinese goods, the president has maintained restrictions on the ability of Chinese companies to access U.S. technology and expanded the list of Chinese officials under sanctions by the United States for their role in undermining Hong Kong’s democratic institutions.Mr. Biden’s hard-line approach to China comes at a moment of extraordinary tension between the world’s largest and second largest economies, and remarkably little interchange between their governments.President Biden met with the leaders of Australia, India and Japan at the White House last month, aiming to put the major democracies of the region in agreement on how to deal with China.Sarahbeth Maney/The New York TimesIn the past month, the United States has announced a new deal to provide nuclear-powered submarines to Australia, an effort to push back on Beijing’s military modernization and its claims of territory in the South China Sea. Mr. Biden also met at the White House with the leaders of Japan, Australia and India, aiming to put the major democracies of the region in accord on how to deal with China’s influence and authoritarianism. And the United States and China are both seeking technological advantage, even if it means cutting off each other’s access to key goods.China, having repressed dissent in Hong Kong and essentially wiped away its guarantees to Britain about keeping its hands off the territory for decades, is now regularly threatening Taiwan. The United States formally protested some of China’s actions on Sunday, after dozens of military aircraft flew on Friday and Saturday into Taiwan’s air defense identification zone, although not over the island itself. While U.S. officials do not expect Beijing to move against Taiwan, they are increasingly concerned about the possibility of an accidental conflict.Trade was one area — along with climate — where mutual interest might steer the two countries to some agreements, even as they compete in other areas. But it is unclear whether they can find a way to reach an accord amid other tensions.Mr. Trump’s deal halted the trade war, but it did not put an end to economic hostilities. China still maintains tariffs on 58.3 percent of its exports from the United States; the United States imposes tariffs on 66.4 percent of the products it brings in from China, according to Mr. Bown.Some Biden officials, like many economists, have made clear that they see the tariffs as counterproductive and taking a toll on American consumers and manufacturers as well as Chinese businesses. Treasury Secretary Janet L. Yellen said in July that the China deal had “hurt American consumers.”Asked if they would consider additional tariffs on China, officials said the Biden administration would not be taking any tools off the table. The administration planned to use the enforcement mechanism established in the trade deal, they said, which would allow the United States to resort to further tariffs if consultations were unsuccessful.In a planned speech on Monday at the Center for Strategic and International Studies, a Washington think tank, Ms. Tai is set to highlight how some of Beijing’s unfair practices have affected U.S. workers and how the United States is building global coalitions to counter them.The Biden administration could face an even more difficult task in reaching any trade agreement with China than the Trump administration did four years ago. Republican lawmakers are ready to pounce on any perceived weakness on China from Mr. Biden, and diplomatic and economic relations between the two countries have deteriorated.“Against the backdrop of worldwide opposition against Cold War and division, the United States blatantly violated its policy statement of not seeking a new Cold War and ganged up to form an Anglo-Saxon clique,” Wang Yi, the Chinese foreign minister, said on Sept. 28 in response to the Australian submarine deal.The U.S. release of Meng Wanzhou, a Huawei executive who had been detained in Canada at the request of the United States, and China’s subsequent release of two Canadians and two Americans, have done little to cool tensions.Mr. Trump’s tariffs have discouraged imports of some Chinese goods, but exports to the United States have grown strongly through the coronavirus pandemic, as Americans purchased workout equipment, furniture, toys and other products during lockdown.China’s leaders have also doubled down on the kinds of domestic industrial subsidies that the United States has long objected to. They have greatly expanded programs, started more than a decade ago, aimed at eliminating their need to buy computer chips and passenger jets — two of the United States’ main exports to China — among other industrial products.The Biden administration has been exploring ways to persuade China to limit its broad industrial subsidies, but that will be difficult. The George W. Bush, Obama and Trump administrations all tried with little success for ways to coax China to abandon its long-running use of subsidies to domestic producers as a tool to wean itself from any reliance on imports.China’s leader, Xi Jinping, has called for making sure that other countries remain dependent on China for key goods, so that they will not threaten to halt their own sales to China. The United States has done so over issues like surveillance, forced labor and the crackdown on democracy advocates in Hong Kong.“The dependence of the international industrial chain on our country has formed a powerful countermeasure and deterrent capability for foreign parties to artificially cut off supply,” Mr. Xi said in a speech last year.In the call on Sunday, Biden administration officials acknowledged that talks might not persuade China to abandon its increasingly authoritarian, state-centered approach. So instead, they said, the administration’s primary emphasis will be on building the competitiveness of the U.S. economy, working with allies and diversifying markets to limit the impact of Beijing’s harmful trade practices.Keith Bradsher reported from Shanghai, and More

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    U.S. and Europe Announce New Trade Cooperation, but Disputes Linger

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    A new trade and technology partnership aims to counter China, but tensions over issues like metal tariffs remain.WASHINGTON — The United States and the European Union took a step this week toward a closer alliance by announcing a new partnership for trade and technology, but tensions over a variety of strategic and economic issues are still simmering in the background.The establishment of the Trade and Technology Council, which aims to establish a united front on trade practices and sophisticated technologies, is a significant test of whether President Biden can fulfill his pledge to mitigate trans-Atlantic tensions that soared under President Donald J. Trump. The Biden administration has long described Europe as a natural partner in a broader economic and political confrontation with China, and it criticized the Trump administration for picking trade fights that alienated European governments.But while officials on both sides say trans-Atlantic relations have been improving, the U.S.-Europe reset has been rockier than anticipated.The inaugural meeting of the Trade and Technology Council in Pittsburgh this week was nearly scuttled after the Biden administration said it would share advanced submarine technology with Australia, a deal that enraged the French government.Europeans say they have been frustrated by a lack of consultation with the Biden administration on a range of issues, including the U.S. withdrawal from Afghanistan. And officials face a difficult negotiation in the coming weeks over metal tariffs that Mr. Trump imposed globally in 2018.Europeans have said they will impose retaliatory tariffs on other U.S. products as of Dec. 1 unless Mr. Biden rolls back a 25 percent tax on European steel and a 10 percent duty on aluminum.“The E.U. initially viewed the Biden administration as a ‘breath of fresh air’ but is now increasingly wondering how much Biden will differ from Trump,” Stephen Olson, a senior research fellow at the Hinrich Foundation and a former U.S. trade negotiator, wrote in a recent analysis. “Prospects for a U.S.-E.U. ‘united front’ have been overblown from the start.”Valdis Dombrovskis, the European commissioner for trade, said in a round table with journalists in Washington on Tuesday that the two sides had been doing intensive work on the issue. They were aiming to reach an agreement by early November to have enough time to avert European countertariffs, he said.The European Union was disappointed with the Biden administration’s handling of the Australian submarine agreement, Mr. Dombrovskis added, but “occasional divergences” should not disrupt their strategic alliance.“Of course, as allies and friends, we do not always agree on everything, and we have seen this in recent weeks,” Mr. Dombrovskis said, adding that there had been more engagement from the Biden administration than the Trump administration.In meetings this week, Secretary of State Antony J. Blinken; Gina Raimondo, the commerce secretary; Katherine Tai, the U.S. trade representative; and their European counterparts pledged to collaborate on a variety of 21st-century issues, such as controlling exports of advanced technology, screening investments for national security threats and offering incentives to manufacture chips in Europe and the United States as a semiconductor shortage continues.Though official documents did not explicitly mention China, the partnership is clearly aimed in part at countering the country’s authoritarian practices. Among other goals, the council promised to combat arbitrary and unlawful technological surveillance and the trade-distorting practices of nonmarket economies.U.S. and European officials in June announced an agreement ending a 17-year dispute over aircraft subsidies given to Airbus and Boeing.But a lingering fight over Mr. Trump’s metal tariffs on imports from Europe and elsewhere could prove harder to resolve. Mr. Biden is under intense pressure to maintain barriers to imports from domestic steel makers and labor unions that supported his campaign.In a virtual round table on Thursday, industry executives and labor leaders said that cheap steel produced in Europe could still damage the U.S. industry.While China is best known for subsidizing its steel industry, European makers have also been major recipients of government subsidies, giving them an unfair advantage over U.S. competitors, said Lourenco Goncalves, the chief executive of Cleveland-Cliffs Inc., an American iron ore mining company.He urged the Biden administration to negotiate from a “position of strength.”“We need the White House, and we need the ones on the front line not to be affected by sweet talk, particularly from the Europeans,” Mr. Goncalves said. “I believe that the friends are a lot worse than the enemies.”U.S. officials made an offer to their European counterparts this summer to transform the current 25 percent tariff on European steel into a so-called tariff-rate quota, an arrangement in which higher levels of imports are met with higher duties, according to a person familiar with the discussions, who spoke on the condition of anonymity to discuss confidential matters.The Europeans have argued for a more flexible arrangement, and discussions are expected to intensify over the next three weeks, the person said.Thomas Kaplan More

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    Businesses Push Biden to Develop China Trade Policy

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    Seven months into a new administration, companies want the White House to drop tariffs on Chinese goods and provide clarity about a critical trade relationship.WASHINGTON — More than seven months into the Biden administration, American businesses say they are growing increasingly frustrated by the White House’s approach to China, with confrontational policies imposed during the Trump era still in place and President Biden offering little clarity about economic engagement with the world’s second-largest economy.The relationship between the two economic superpowers remains deeply fractured. American import duties still exist on roughly $360 billion worth of Chinese goods, and almost all of the exemptions that shielded more than 2,000 products from those tariffs have expired. A thicket of export controls and bans are still in place, leaving U.S. technology giants such as Qualcomm, Intel and Google in the lurch over how to approach the Chinese market and offering little hope that the decoupling of the world’s two largest economies will be reversed anytime soon.To the dismay of some American business leaders, Mr. Biden has amplified some of the Trump administration’s punitive moves. In July, the Biden administration expanded the list of Chinese officials under sanctions by the United States for their role in undermining Hong Kong’s democratic institutions. In June, the president issued an executive order adding more Chinese companies to a prohibition on American investments in Chinese firms that have links to the country’s military or that sell surveillance technology used to repress dissent or religious minorities.Yet Mr. Biden and his top advisers have yet to elucidate how they view economic relations with Beijing, saying they will make the administration’s approach known once a broad review of China trade policy concludes. But the review has stretched on for months with no public timeline for its conclusion.As a result, businesses are lobbying heavily for the tariffs to be removed, which would make it easier for them to rely on factories in China instead of making investments in the United States or elsewhere. And they want assurances that they can do business with a financially important market.“There has been frustration for the business community at the lack of concrete China economic policy,” said Charles Freeman, the senior vice president for Asia at the U.S. Chamber of Commerce. “It’s not as if this crowd came in without any experience or any preconceived thinking about China.”The future of the U.S. trade relationship with China is one of the biggest global economic questions confronting Mr. Biden and his advisers. China has thrown huge resources behind its economic ambitions and plans to dominate cutting-edge industries like artificial intelligence and robotics by providing government subsidies to Chinese firms and using other tactics, including espionage. While the Trump administration signed an initial trade deal with China that included purchase commitments for agricultural and other goods, the agreement failed to address a number of major concerns, including China’s state-owned enterprises and industrial subsidies.During his White House bid, Mr. Biden assailed President Donald J. Trump over his trade war and promised to enlist allies to counter China over its trade practices. Since taking office, Mr. Biden has resolved a longstanding trade spat with the European Union and persuaded European officials to adopt a more assertive trade policy toward China this year. And he has pitched his infrastructure plan as a way to counter Beijing, saying it would “put us in a position to win the global competition with China in the upcoming years.”But the administration has said little about whether it intends to restart economic talks and address outstanding issues, including tariffs. At times, officials have offered somewhat discordant views.Treasury Secretary Janet L. Yellen told The New York Times this summer that tariffs had harmed American consumers, but she has also warned that Chinese subsidies for exporters pose a challenge for the United States. The United States trade representative, Katherine Tai, has described the tariffs as providing leverage..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-w739ur{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-w739ur{font-size:1.25rem;line-height:1.4375rem;}}.css-9s9ecg{margin-bottom:15px;}.css-uf1ume{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;}.css-wxi1cx{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;-webkit-align-self:flex-end;-ms-flex-item-align:end;align-self:flex-end;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}Asked on Wednesday about the administration’s review of the tariffs, Jen Psaki, the White House press secretary, said, “I don’t have any timeline for you on when that review will be completed.”Business impatience with the administration’s approach is mounting. Corporate leaders say they need clarity about whether American companies will be able to do business with China, which is one of the biggest and fastest-growing markets. Business groups say their members are being put at a competitive disadvantage by the tariffs, which have raised costs for American importers.“We should be doing everything we can to increase China’s use and dependence on American technology products,” Patrick Gelsinger, the chief executive of Intel, said in an interview last week. The administration is “struggling to lay out a framework for how they have a policy-driven engagement with China,” he said.“To me, just saying, ‘Let’s be tough on China,’ that’s not a policy, that’s a campaign slogan,” he added. “It’s time to get to the real work of having a real policy of trade relationships and engagement around business exports and technology with China.”In early August, a group of influential U.S. business groups sent a letter to Ms. Yellen and Ms. Tai urging the administration to restart trade talks with China and cut tariffs on imported Chinese goods.“The main kind of dilemma that companies face right now is just uncertainty,” said Craig Allen, the president of the U.S.-China Business Council, which organized the letter. “Will the tariffs remain in place? Are they in place in perpetuity? What is the exclusion process to request an exemption from the tariffs? Nobody knows.”Mr. Allen said his group had organized the letter because it wanted to make sure that businesses’ views, in addition to those of labor and environmental groups, would be taken into account during the Biden administration’s China review.“Many find it ironic that the Biden administration is following so closely the playbook laid down by the Trump administration on China,” he said.Other organizations that signed the letter included the U.S. Chamber of Commerce and the Business Roundtable as well as groups representing sectors of the economy with close business ties to China, such as the Pharmaceutical Research and Manufacturers of America, the Semiconductor Industry Association and the American Farm Bureau Federation.“We’re now dealing with all these other supply chain disruption issues that are costing companies millions of dollars,” said Jonathan Gold, the vice president for supply chain and customs policy at the National Retail Federation, which also signed the letter and represents a sector that has become heavily dependent on imports from China. “To have the tariffs on top of that is difficult for planning purposes.”On Tuesday, the National Association of Manufacturers sent a letter to the Biden administration urging it to “act as quickly as possible to finalize and publicize” a China strategy.Businesses of all sizes have been waiting for Mr. Biden to change course from Mr. Trump’s trade policies. Arnold Kamler, the chief executive of Kent International, a bicycle wholesaler and manufacturer, said the 25 percent tariffs on bicycle imports from China had been a major drain on the cash flow of his business, forcing him to borrow more from his bank. For the last two years, he has been passing on the cost of the additional import duties to retailers.“Honestly, we were hopeful that the Biden administration would realize that the trade war didn’t work,” Mr. Kamler said.Katherine Tai, the U.S. trade representative, has refrained from offering a preview of what steps the Biden administration may seek to take in the coming months.Pete Marovich for The New York TimesAdding to the impatience is that a vast majority of the exclusions to the China tariffs that were granted under the Trump administration have now expired, and the Biden administration has not created a process to allow companies to seek new exclusions.Lawmakers from both parties have written to the Biden administration urging it to restart the exclusion process, and the Senate included a provision to reinstate expired exclusions and set up a process for granting new ones as part of a legislative package to bolster competitiveness with China that passed in June. The Senate provision has been met with resistance in the House, according to a House Democratic aide, so the two chambers may wind up at odds over whether to address tariff exclusions as part of a final China package.Robert E. Lighthizer, who was Mr. Trump’s trade representative and negotiated the trade deal with China, said in an interview that lobbyists were trying to weaken the executive branch’s power to impose tariffs.“People working for China and Chinese importers want to get rid of the last tool that Biden and subsequent presidents will have to deal with Chinese unfair trade practices,” Mr. Lighthizer said.Business groups are not uniformly in favor of lifting tariffs. The National Council of Textile Organizations, which represents the American textile industry, wants the administration to keep tariffs on finished apparel and home textile products from China.“We have been pretty strong in our message to the administration saying please continue this approach on getting tough on China,” said Kimberly Glas, the textile group’s president and chief executive.Any decision on rolling back tariffs could also have domestic political implications in the United States, where a tough-on-China mentality has permeated both major parties. Any steps by the Biden administration to roll back Trump-era policies toward Beijing could be seized on by political opponents seeking to paint Mr. Biden as insufficiently tough on China at a time when the country is engaged in a rapid military buildup.Scott Paul, the president of the Alliance for American Manufacturing, a trade group that represents the United Steelworkers and some domestic manufacturers, noted that concern about China on both economic and national security grounds was “one of the few issues that unites Democrats and Republicans these days.”“A dismantling of the tariffs has no upside for Joe Biden,” he said. “At a time when you’re trying to build up U.S. capacity in key industries, it would invite a flood of Chinese imports to just overwhelm that.”The Biden administration has said little about its tariff plans or how it will address China’s failure to meet its commitments under the Trump trade deal. China has not fulfilled its purchase commitments, according to Chad P. Bown, a senior fellow at the Peterson Institute for International Economics who has tracked China’s purchases of U.S. goods. But Chinese economists contend that Beijing has been sincere in wanting to meet its promises, and that the pandemic has affected demand in China.When asked about the administration’s review of China trade policy, Ms. Tai has responded by saying she was aware that “time is of the essence.” However, she has refrained from offering a preview of what steps the administration may seek to take.“In terms of how we need to approach this trade relationship,” Ms. Tai said at a virtual event last week, “we need to approach it with deliberation.”Keith Bradsher More

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    China’s Vaccine Diplomacy Stumbles in Southeast Asia

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    Several Southeast Asian nations are raising doubts about the efficacy of China’s vaccines. The Biden administration has recently offered to provide shots, “no strings attached.”SINGAPORE — The arrival of the Chinese vaccines was supposed to help stop the spread of the coronavirus in Southeast Asia.Instead, countries across the region are quickly turning elsewhere to look for shots.Residents in Thailand vaccinated with one dose of China’s Sinovac are now given the AstraZeneca shot three to four weeks later. In Indonesia, officials are administering the Moderna vaccine as a booster to health care workers who had received two doses of Sinovac.Malaysia’s health minister said the country would stop using Sinovac once its supply ran out. Even Cambodia, one of China’s strongest allies, has started using AstraZeneca as a booster for its frontline workers who had taken the Chinese vaccines.Few places benefited from China’s vaccine diplomacy as much as Southeast Asia, a region of more than 650 million that has struggled to secure doses from Western drugmakers. Several of these countries have recorded some of the fastest-growing number of cases in the world, underscoring the desperate need for inoculations.China, eager to build good will, stepped in, promising to provide more than 255 million doses, according to Bridge Consulting, a Beijing-based research company.Half a year in, however, that campaign has lost some of its luster. Officials in several countries have raised doubts about the efficacy of Chinese vaccines, especially against the more transmissible Delta variant. Indonesia, which was early to accept Chinese shots, was recently the epicenter of the virus. Others have complained about the conditions that accompanied Chinese donations or sales.The setback to China’s vaccine campaign has created a diplomatic opening for the United States when relations between the two countries are increasingly fraught, in part because of the coronavirus. China has criticized the American handling of the crisis at home and even claimed, with no evidence, that the pandemic originated in a military lab at Fort Detrick, Md., not in Wuhan, where the first cases emerged in late 2019.As more countries turn away from Chinese shots, vaccine aid from the United States offers an opportunity to restore relations in a region that American officials have mostly ignored for years while China extended its influence. The Biden administration has dispatched a crowd of senior officials, including Vice President Kamala Harris, who is scheduled to arrive on Sunday to visit Singapore and Vietnam. It has also, at last, made its own vaccine pledges to Southeast Asia, emphasizing that the American contribution of roughly 23 million shots as of this week comes with “no strings attached,” an implicit reference to China.Anti-China sentiment runs high in Vietnam, but the country accepted a donation of 500,000 doses of Sinopharm in June, causing a backlash among citizens who said they did not trust the quality of Chinese shots.Linh Pham/Getty ImagesSeveral countries in the region have been eager to receive the more effective, Western doses. Although they remain far outnumbered by Chinese shots, they present an attractive alternative. China’s “early head-start advantage has lost its magic already,” said Hoang Thi Ha, a researcher with the Asean Studies center of the ISEAS-Yusof Ishak Institute in Singapore.For most of the year, many developing countries in Southeast Asia did not have much of a choice when it came to vaccines. They struggled to acquire doses, many of which were being made by richer nations that have been accused of hoarding them.China sought to fill those needs. The country’s foreign minister, Wang Yi, traveled through the region in January, promising to help fight the pandemic. In April, he declared that Southeast Asia was a priority for Beijing. About a third of the 33 million doses that China has distributed free worldwide were sent to the region, according to the figures provided by Bridge Consulting.Much of Beijing’s focus has been directed at the more populous countries, such as Indonesia and the Philippines, and its longstanding allies like Cambodia and Laos.Indonesia was China’s biggest customer in the region, buying 125 million doses from Sinovac. The Philippines obtained 25 million Sinovac shots after the president, Rodrigo Duterte, said he had turned to Xi Jinping, China’s top leader, for help. Cambodia received more than 2.2 million of China’s Sinopharm doses. It has inoculated roughly 41 percent of its population, achieving the second-highest vaccination rate in the region, after Singapore.Then, signs started emerging that the Chinese vaccines were not as effective as hoped. Indonesia found that 10 percent of its health care workers had become infected with Covid-19 as of July, despite being fully vaccinated with the Sinovac shot, according to the Indonesian Hospital Association.In July, a virologist at Chulalongkorn University in Bangkok said a study of people who had received two doses of the Sinovac vaccine showed that their level of antibodies, 70 percent, was “barely efficacious” against the Alpha variant of the coronavirus, first detected in Britain, or against the Delta variant, first detected in India.The governments in both Indonesia and Thailand decided that they had to make a switch to other vaccines, like those provided by the United States, Britain and Russia.“Now that they have more choices, they can make other decisions,” said Nadège Rolland, senior fellow at the National Bureau of Asian Research in Washington. “I don’t think it’s politically motivated. I think it’s pragmatic.”Yaowares Wasuwat, a noodle seller in Thailand’s Bangsaen Chonburi Province, said that she hoped to get the AstraZeneca vaccine for her second shot after being inoculated with Sinovac, but that she would take whatever was available.“I have nothing to lose,” she said. “The economy is so bad, we are gasping for air. It’s like dying while living, so just take whatever protection we can.”Lloyd J. Austin III, the U.S. secretary of defense, met with President Rodrigo Duterte in Manila in July. The United States said it would deliver millions of doses of the Johnson & Johnson and Moderna vaccines to the country.Malacanang Presidential Photo/via ReutersChina’s early moves in the region stand in marked contrast with the United States, which was slow to provide assistance..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-w739ur{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-w739ur{font-size:1.25rem;line-height:1.4375rem;}}.css-9s9ecg{margin-bottom:15px;}.css-16ed7iq{width:100%;display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;-webkit-box-pack:center;-webkit-justify-content:center;-ms-flex-pack:center;justify-content:center;padding:10px 0;background-color:white;}.css-pmm6ed{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;}.css-pmm6ed > :not(:first-child){margin-left:5px;}.css-5gimkt{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:0.8125rem;font-weight:700;-webkit-letter-spacing:0.03em;-moz-letter-spacing:0.03em;-ms-letter-spacing:0.03em;letter-spacing:0.03em;text-transform:uppercase;color:#333;}.css-5gimkt:after{content:’Collapse’;}.css-rdoyk0{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;-webkit-transform:rotate(180deg);-ms-transform:rotate(180deg);transform:rotate(180deg);}.css-eb027h{max-height:5000px;-webkit-transition:max-height 0.5s ease;transition:max-height 0.5s ease;}.css-6mllg9{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;position:relative;opacity:0;}.css-6mllg9:before{content:”;background-image:linear-gradient(180deg,transparent,#ffffff);background-image:-webkit-linear-gradient(270deg,rgba(255,255,255,0),#ffffff);height:80px;width:100%;position:absolute;bottom:0px;pointer-events:none;}.css-uf1ume{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;}.css-wxi1cx{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;-webkit-align-self:flex-end;-ms-flex-item-align:end;align-self:flex-end;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}The calculus has now changed under President Biden. Both Lloyd J. Austin III, the American secretary of defense, and Antony J. Blinken, the secretary of state, had meetings with top officials in Southeast Asia in recent weeks. They noted the donations of roughly 20 million shots.After Mr. Austin visited the Philippines, Manila restored a defense agreement that had been stuck in limbo for more than a year after Mr. Duterte threatened to terminate it. The agreement, which would continue to allow American troops and equipment to be moved in and out of the Philippines, could thwart China’s goal to push the American military out of the region.Part of the reason for Mr. Duterte’s turnaround: the delivery of millions of doses of Johnson & Johnson and Moderna vaccines.Still, some Southeast Asian analysts have misgivings about Washington’s belated vaccine diplomacy.“The fact remains that the U.S. was really slow off the bat,” said Elina Noor, director of political-security affairs at the Asia Society Policy Institute. “And given that rich countries were hoarding vaccines when they became available, I think that sour taste still lingers.”China continues to be seen to be a reliable supplier for the vaccines it has produced. It has delivered 86 percent of the doses that it has promised to sell. And there remain concerns that the American companies have been slow to make deliveries. For those reasons, most Southeast Asian countries have not openly criticized China — and have not abandoned Chinese vaccines.Anti-China sentiment runs high in Vietnam, but the country accepted a donation of 500,000 doses of Sinopharm in June, causing a backlash among citizens who said they did not trust the quality of Chinese shots.“Even right in the middle of this emergency, I have no reason to trade my life or my family’s for a Chinese vaccine,” said Nguyen Hoang Vy, a manager for health care operations at a hospital in the city of Ho Chi Minh.It later emerged that the donated Sinopharm shots were meant for priority groups outlined by Beijing, deepening the cynicism toward China.“There are always some conditions attached,” said Huong Le Thu, a senior analyst at the Australian Strategic Policy Institute who specializes in Southeast Asia, referring to China’s vaccine deals.Vietnam continues to battle an outbreak, and vaccines remain in short supply. Despite the earlier public anger, a private Vietnamese company acquired five million doses of Sinopharm for distribution, which local authorities began to administer this month.Muktita Suhartono More

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    U.S.-China Trade Talks Should Resume, U.S. Business Groups Say

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    A letter from influential industry organizations asked the White House to resume negotiations on tariffs and other measures that stalled during a bruising trade war.A group of the most influential American business groups is urging the Biden administration to restart trade talks with China and cut tariffs on Chinese-made goods that had remained in place after the start of the bruising trade war between the two countries.The groups, which represented interests as diverse as potato farmers, microchip companies and the pharmaceutical industry, said in a letter dated Thursday that the Biden administration should take “swift action” to address “burdensome” tariffs. They also called on the White House to work with the Chinese government to ensure that it carries out commitments made in its trade truce with the Trump administration, sealed in early 2020.The letter, addressed to the Treasury Department and the United States trade representative, comes as the relationship between the world’s two largest economies remains fractious. A high-profile visit to China last month by Wendy R. Sherman, the deputy secretary of state, began with acerbic opening remarks from the Chinese side and ended with little sign of progress. The two have squabbled over human rights, cyberattacks and China’s military operations in the South China Sea.While the Biden administration has mapped out a strategy of confrontation with China on a range of issues, it has said less about the countries’ economic relationship.It is more than seven months into a review of the trade deal that former President Donald J. Trump signed with China in January 2020, along with other national security measures from the previous administration. Officials have not yet announced the results of that review.A visit to China last month by Wendy R. Sherman, the deputy secretary of state, ended with little sign of progress.U.S. Department of State, via ReutersThe January 2020 trade truce essentially froze into place U.S. tariffs on $360 billion in Chinese imports. That deal also did nothing to stop the Chinese government’s subsidies of strategic industries like computer chips and electric cars, which have worried American competitors. While some of the provisions of the trade deal are set to expire at the end of the year, much of the agreement will remain in place.The industry group letter appeared to be an attempt to prod the Biden administration into action.“Due to the tariffs, U.S. industries face increased costs to manufacture products and provide services domestically, making their exports of these products and services less competitive abroad,” read the letter, which was reviewed by The New York Times.The Treasury Department and the United States Trade Representative did not immediately comment. The existence of the letter was reported earlier by The Wall Street Journal.The letter said that China had met some of its commitments as part of the trade deal, including new measures to open up its market to U.S. financial institutions. It added that further talks would be the only way to ensure that China would carry out remaining commitments in other sectors, like intellectual property protection.Shipping containers at a port in Nantong, China. A letter from U.S. business groups is asking the Biden administration to cut tariffs on Chinese-made goods.CHINATOPIX, via Associated PressThough China has made large-scale purchases of U.S. goods since the trade war, the amount and composition have fallen short of its commitments to buy $200 billion worth of American goods and services in 2020 and 2021. According to analysis by the Peterson Institute for International Economics, China fell short of those purchases by 40 percent last year and is off by 30 percent this year.“We strongly urge the administration to work with the Chinese government to increase purchases of U.S. goods through the remainder of 2021 and implement all structural commitments of the agreement before its two-year anniversary on Feb. 15, 2022,” the letter added.While the Biden administration has questioned whether the trade deal with China was well designed, it has also signaled that it will continue to push China on what it perceives as unfair trade practices.In June, President Biden expanded a Trump administration blacklist that blocked Americans from investing in Chinese companies that aid the country’s military or repression of religious minorities. Mr. Biden included Huawei, a Chinese telecommunications giant, on the list of banned firms. The White House also announced the formation of a trade and technology council with American and European officials, an effort to counter China’s influence by coordinating digital policies between Brussels and Washington.“We will not hesitate to call out China’s coercive and unfair trade practices that harm American workers, undermine the multilateral system or violate basic human rights,” Katherine Tai, the United States trade representative, said in prepared testimony for a Senate hearing in May. “We are working toward a strong, strategic approach to our trade and economic relationship with China.” More