Martial Arts: "US to Accelerate Supply Chain Restructuring with Allies This Year... Indicates Strengthened Containment of China"

U.S. Trade Policy Agenda... Direct Mention of 'China's Unfair Trade Practices'

The United States indicated that it will focus on accelerating the restructuring of supply chains with allied countries and strengthening measures to counter China in its trade policy this year.

The United States Trade Representative (USTR) mentioned cooperation on supply chain restructuring with allies and neighboring countries, as well as unfair Chinese trade and economic policies and economic coercion in the "President's Trade Policy Agenda and Annual Report on the Trade Agreements Program" released this year.

In November last year, President Yoon Seok-yeol, who visited the United States to attend the Asia-Pacific Economic Cooperation (APEC) Summit, took a commemorative photo with U.S. President Joe Biden and Japanese Prime Minister Fumio Kishida at the Korea-U.S.-Japan summit held at the Moscone Center in San Francisco, USA. 2023.11.17 [Joint Coverage] [Image Source=Yonhap News]

The Korea International Trade Association (KITA) stated this on the 3rd through a trade issue brief titled "Key Contents and Implications of the 2024 U.S. Biden Administration Trade Policy Agenda."

According to KITA, this year’s U.S. trade policy agenda emphasizes a worker-centered trade policy, redefinition of U.S.-China relations, strengthening supply chain resilience, decarbonization, and sustainability, while maintaining the stance pursued by the Biden administration over the past three years.

In particular, regarding U.S.-China trade relations, it pointed out that China is expanding its influence in the global market through unfair practices.

The trade policy agenda described China as "the dominant supplier of many critical goods and technologies," criticizing that "this has been achieved through manipulation of cost structures, control of key industries, and reckless abuse of trade and economic policies."

It also praised domestic investment policies such as the Infrastructure Investment and Jobs Act (IIJA), the CHIPS Act, and the Inflation Reduction Act (IRA) for supporting U.S. industries to compete with China from a favorable position.

Furthermore, it emphasized the need to strengthen supply chain resilience amid worsening supply chain disruptions caused by the COVID-19 pandemic and Russia’s invasion of Ukraine.

For the first time, it directly mentioned "friendshoring" (restructuring supply chains centered on allied countries) and "nearshoring" (relocating production bases to neighboring countries) in relation to supply chain restructuring.

It also confirmed that similar agreements are being pursued with the European Union (EU), the United Kingdom, and others, including the critical minerals agreement with Japan signed last March.

Meanwhile, the trade policy agenda evaluated Korea’s status as a trade partner and ally as "continuously growing."

It added, "The Korea-U.S. Free Trade Agreement (FTA) reflects this bilateral relationship," and "this year, dialogues between the two countries will continue under the Korea-U.S. FTA framework on consultative bodies, supply chains, emerging technologies, sustainable trade, and the digital economy."

KITA forecasted, "Ahead of the election, the Biden administration is likely to minimize controversial changes such as new trade negotiations or tariffs on China, focusing instead on accelerating the enforcement of existing regulations to achieve results in the trade policy field."

It further suggested, "This year, dialogues on trade issues between Korea and the U.S. should continue focusing on low-partisanship agendas such as supply chain resilience, digital economy, emerging technologies, and industrial cooperation," and "there is a need to strengthen outreach with stakeholders and opinion leaders related to trade policy within the U.S. during the election period."