US President Joe Biden holds up his face mask as he speaks about the COVID-19 pandemic during a prime-time address from the East Room of the White House on Wednesday in Washington. Photo: AP

The United States has stepped up its economic roundup of Chinese companies in northwest China’s Xinjiang Uyghur Autonomous Region, urging US companies to stay out of the Xinjiang supply chain in a government warning federal. The US government has also reportedly considered placing an operational risk warning in Hong Kong this week, where the US has huge commercial interests.

The Biden administration’s attempt, using the human rights issue as an excuse, to revert to a path of decoupling is thinly veiled, which will end up hurting US business interests, Chinese experts said on Wednesday. international business and industry insiders.

By hanging on and further exaggerating a lie invented by the previous U.S. administration, Biden’s warning is like a continuation of Trumpism without Trump, Chinese experts have noted. Implicitly alluding to a decoupling of the supply chain, analysts said the move showed the previous human rights map was ineffective and that the Biden administration had to revert to the old path of decoupling with a human rights banner.

Several US federal departments issued a government notice on Tuesday, warning US companies of the risks of becoming part of the supply chain with the Chinese region on the so-called “forced labor” issue. Another warning would be issued in Hong Kong.

The warning includes a list that went to great pains to specifically name 20 industries in Xinjiang, from cotton to melons to wigs and toys, that American companies should avoid, although the warning itself admitted that the inscription “does not confirm that all goods produced in these industries in Xinjiang involve forced labor.”

Among the American motives for blocking local economic and human rights development and wreaking havoc in Xinjiang and Hong Kong in China, suppressing Chinese competitors of American companies is also one of the malicious objectives of the government. government, Chinese analysts noted.

Compared to the Trump administration, Biden has gone further in launching the political battle with decoupling strategies against China under the excuse of human rights, Lü Xiang, a researcher at the Global Times, told the Global Times on Wednesday. the Chinese Academy of Social Sciences in Beijing. , noting that the US measures will seriously undermine bilateral cooperation on climate change and financing.

The warning to US companies in Hong Kong also does not match the facts – after the enactment of the National Security Law for Hong Kong in the past year, the city has regained stability and prosperity with companies. Foreigners happy with the business environment, Lü said, noting that the warning looks more like the last US attempt when all other tricks to disrupt the region have been exhausted.

From Trump’s trade war to Biden’s political war and other aggressive provocations, the United States has strayed even further in its policy towards China, which has increased uncertainty in bilateral relations, said Lü, adding that China should be aware that the Biden administration’s tank might not stop once. It starts.

“After Biden took office, his political performance was poor… and to no avail. It was at this point that he eagerly took the anti-China card in order to gain popularity and respond to critics of the pro-Trump camp, “Tian Feilong, an associate professor at Beihang University Law School, told the Global Times on Wednesday.

“In the United States, as long as politicians play the anti-China card, they can get a boost. Biden knows that well,” Tian said.

A farmer plants cotton in northwest China's Xinjiang Uyghur Autonomous Region in April.  Photo: cnsphoto

A farmer plants cotton in northwest China’s Xinjiang Uyghur Autonomous Region in April. Photo: cnsphoto

American companies will be penalized

Chinese industry insiders and experts have said the Biden administration will hurt the interests of U.S. companies by forcing them to draw a line, which would pave the way for Chinese countermeasures, including the first use of the list of Chinese entities to punish unreliable supply chain partners.

Some foreign companies that blindly follow US-made lies about “forced labor” on Xinjiang cotton have paid a price as Chinese consumers have decided to boycott their products, as did the maker of Xinjiang. Swedish clothing H&M and American and German sportswear manufacturers Nike and Adidas.

H&M saw its sales drop 23% in China in local currencies from March to May, Reuters reported.

US sanctions against Xinjiang’s photovoltaic industries would hamper imports of related products, affecting the global and US development of renewable energy, Lü said. “The result? The Biden administration’s climate change promises would stall.”

Tuesday’s US notice drew contempt in Chinese business circles.

On Wednesday, four polysilicon makers in Xinjiang issued a joint statement protesting the United States’ baseless accusation of “forced labor.” “[The US government] seriously violated the right to development of our companies and the labor rights of our employees, which are the typical “forced unemployment” and “forced poverty,” said the four companies.

He Ning, director of investor relations at polysilicon producer Xinjiang Daqo which has been on the U.S. Entity List, told the Global Times on Wednesday that the company is refusing to conduct a supply chain review for s ‘adapt to US government requirements as it neither sold any products directly to US companies nor purchased US products.

“So far, none of our customers have asked us to do such a supply chain review job,” he said, adding that US companies cannot find short substitutes. run if they don’t buy Chinese solar panels.

The harm to the United States will be far greater than the loss of Chinese companies when the United States clamps down on Chinese solar products, seasoned industry watchers agreed, because it would take a lot of time and a lot of money. in the United States to develop industrial support capacity in the solar energy sector.

Xinjiang accounts for about half of the world’s capacity for polysilicon – a raw material for solar panels.

Yi Jing, deputy general manager of Siwei Textile in Awati County, Aksu Prefecture, Xinjiang, told the Global Times that the company’s sales had not been affected by the US government’s coup. Instead, it inspired the patriotic enthusiasm of the Chinese people to support Xinjiang cotton.

“What American companies have lost is the huge Chinese market if they ban cotton products made in Xinjiang… One in five 100% cotton products in the world come from Xinjiang.

China is certainly capable of dominating the global textile industry, ”Yi said.

The director proposed tit-for-tat countermeasures, including a ban on imports of US cotton and other US products.

Lü warned that if the Biden administration is foolish enough to take one more step – to turn the warning into concrete sanctions or orders for American companies, all foreign companies – in the United States and the EU, will suffer more. because they still see Hong Kong as the important gateway to enter the mainland China market and other Southeast Asian countries.

US action covering Hong Kong would hurt investment and transaction relationships of US companies in the city, and a strong boycott of some US companies is to be expected, Tian warned.

“US interests in Hong Kong are important because it has a large amount of US investment,” the professor said, citing that more than 1,200 US companies are operating in Hong Kong to cover their activities in the Asia-Pacific region, so the repression will harm the global presence of these American companies and their regional competitiveness.

The US move will wipe out the $ 30 billion trade surplus with the Hong Kong Special Administrative Region, he added.

“Following Trump’s path is very stupid for the Biden administration because it harms others without profiting from it,” Tian said.

In Trump’s infamous trade war with China, American companies ended up suffering economic losses, and the United States’ trade deficits with China were by no means reduced.

Craig Allen, chairman of the US-China Business Council, published an article in Politico in June titled “US-China trade dispute hurts Americans” and quoted Moody’s Analytics as suggesting that US companies had supported more than 90 percent of US tariff costs on Chinese goods.

In response to the United States’ decision on Tuesday, Chinese Foreign Ministry spokesman Zhao Lijian told a routine press conference on Wednesday that the United States was repeating cliché lies about Xinjiang. Chinese and that each time, they only exposed their hypocrisy on human rights issues and their hegemonic nature, citing its own tainted human rights record.

Chinese countermeasures

Zhou Shijian, a senior researcher at Tsinghua University’s Center for US-China Relations, suggested that China’s unreliable entity list could be used as part of a retaliatory tool.

“For example, China could ban its supply of silicon, a vital material used in the solar industry, to some US companies in retaliation,” Zhou told the Global Times on Wednesday.

Some pundits doubt that U.S. companies actually heed the Biden administration’s warning.

Liang Haiming, chairman of the China Silk Road iValley Research Institute, told the Global Times that he suspected the warnings were more symbolic than real and that the government could not prevent willing American investors from investing in Hong Kong.

A recent job expansion program revealed by Citibank and Goldman Sachs shows that US investors have a rather different understanding of the risks of investing in Hong Kong than the US government.