03:10
Protests at US Congress after House passes bill that could potentially ban TikTok nationwide
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https://scmp.com/economy/global-economy/article/3258993/global-impact-chinese-owned-social-media-platform-tiktok-facing-ban-us-china-hits-back-never-ending Global Economy
Global Impact: Chinese-owned social media platform TikTok is facing a ban in the US as China hits back at ‘never-ending cycle’
- Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world
- In this week’s issue, we look to keep up with the complex and ever-evolving US-China relationship, with a particular focus on Washington’s moves to ban video-sharing app TikTok
In this week’s issue of the Global Impact newsletter, we look to keep up with the complex and ever-evolving US-China relationship, with a particular focus on Washington’s moves to ban video-sharing app TikTok. Photo: AP
Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world. Sign up now!
We’re coming up on six years since former US president Donald Trump started a trade war with China and marked the beginning of a new, more contentious approach by Washington towards Beijing to address perceived threats to American economic interests and national security.
While the punitive tariffs seemed to do very little initially, countless investigations, congressional hearings, and dire warnings about China by policymakers in both of the major political parties appear to have moved the needle back after decades of growth in the bilateral economic relationship.
For the first time in 17 years, China was dethroned as the United States’ top source of imports last year, with Mexico outpacing in terms of the total value of goods shipped.
Still, total US imports from China last year reached US$427.2 billion, slightly ahead of the US$421.1 billion from Canada, showing how much of a challenge it would be for those advocating for a much more significant break in economic ties.
Many ordinary Americans might have a very low opinion about China – a recent poll showed that nearly three in five considered the country’s rise a critical threat to US interests, but the details surrounding trade and investment tend to fly under the radar of public opinion.
All that changed when the US government put the popular video-sharing app TikTok, owned by China’s ByteDance, in its cross hairs several years ago. That action turned the debate over restrictions against Chinese products into a national conversation.
When Trump issued his executive order on concerns that the app could send sensitive data about Americans to China’s government, eventually undone by successor Joe Biden shortly after he entered the White House, the US user base was around 100 million.
Several years and multiple congressional hearings later – after Trump tried unsuccessfully to force ByteDance to sell the property – it now has around 170 million American users.
As lawmakers on both sides of the aisle have raised increasingly urgent alarms about the extent to which TikTok could be a national security vulnerability, the House of Representatives passed a bill that would force ByteDance to divest the app.
A combination of diehard users, free-speech advocates and libertarian-leaning politicians have spoken out against the effort to ban the app or force a divestiture.
And in a bizarre twist, even Trump – the presumptive Republican nominee in this year’s presidential election – backed away from his position, which stirred up speculation that a billionaire Republican megadonor with connections to ByteDance was behind that change of heart.
TikTok aside, the scope of restrictions threatening to further decouple the US and China seems to widen each week as the Biden administration insists on trying to “responsibly manage competition”.
In February, Biden and the US Coast Guard announced a series of actions to keep China’s presence in the country’s port infrastructure in check. Just days later, the US Department of Commerce opened an investigation into whether Chinese vehicle imports posed a national security risk and could impose restrictions due to concerns about “connected” car technology.
China’s top envoy slammed the moves as irrational anxiety that would lead to “a never-ending cycle” of action against the country.
02:15
Singaporeans fume over US lawmaker grilling of TikTok CEO
Those remarks, which came before a recent series of high-level bilateral engagements, including a phone call between Xi Jinping and Biden and a visit to China by US Treasury Secretary Janet Yellen, highlight the ever-changing nature of the relationship, which included a face-to-face summit between the two leaders in November that yielded pledges to get communication back on track.
However, the overall consensus says that little has changed in terms of the factors that have led to the restrictions, according to analysts including Dominic Chiu of Eurasia Group and Lu Xiang, a senior researcher with the Chinese Academy of Social Sciences.
“The real issues revolve around the small-yard, high-fence strategy of the US and its worries regarding overcapacity, and we don’t exclude the possibility that the Biden administration will implement other restrictive measures,” Lu said following Yellen’s meetings in China at the start of April.
And Biden faces increasing pressure from other policymakers in Washington, including former deputy national security adviser Matthew Pottinger, who has insisted that the White House shift to a more explicit Cold War stance.
Congress is also moving to bolster restrictions.
Curbs that the Biden administration has put on exports of the most cutting-edge semiconductor chips to China, and on US investments into Chinese companies developing some of the most advanced technologies, are not enough for many lawmakers.
A House subcommittee hearing in January explored additional ideas for legislation to block US money from bolstering China’s technological and military sectors.
Last week, Republican Senator Mitt Romney and his colleague, Maggie Hassan, a Democrat, introduced a bill that would create a centre to coordinate efforts to stop the shipment of US semiconductors, artificial intelligence and quantum technology to countries including China.
Meanwhile, the billions of dollars of Chinese venture capital that had flowed into US start-ups – often through investors connected to the country’s government – has come to a near-total stop.
The possibility of a second Trump presidency is unlikely to ease the friction. While he has softened on TikTok, the presumptive Republican nominee has threatened tariffs of 60 per cent or more on Chinese products headed for the US market, if he wins in November.
60-Second Catch-up
Video: Protests at US Congress after House passes bill that could potentially ban TikTok nationwide.
Call between Xi Jinping and Joe Biden conveys stability, deep disconnect in US-China ties: analysts.
Deep dives
Illustration: Victor Sanjinez
US-China all-out trade war unlikely but soft-power gap will persist: Joseph Nye
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Global affairs expert Joseph Nye shares his assessments of what China has done right, and what will hold it back
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In terms of economic challenges, ‘we should not exaggerate the China threat’, Nye says
For the Open Questionsseries of interviews with global opinion leaders, Josephine Ma speaks with Joseph Nye, a former US assistant secretary of defence. Nye is university distinguished service professor, emeritus and former dean of Harvard’s John F. Kennedy School of Government, and has been ranked among the top 100 global thinkers. Read the previous instalment in the series, with political scientist Li Cheng, here.
You are most well known in China for your book on soft power and even former Chinese president Hu Jintao mentioned it in the 17th party congress report. China has invested heavily in expanding its soft power and President Xi Jinping has told officials to “tell the China story well”. How do you comment on these efforts? What are the achievements and what are the failures, and why?
Illustration: Davies Christian Surya
As Washington cracks down on Chinese businesses, lobbyists come under fire
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Concerns about Beijing’s potential to threaten US national security have spurred several bills seeking more scrutiny about who is representing Chinese interests
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Weeks after one list of Chinese companies and their lobbyists circulates on Capitol Hill, several firms drop their clients, including DJI and Hesai Tech
In early February, a list made the rounds among Capitol Hill staffers. It named several Chinese companies and their Washington lobbyists, as well as the federal “entity lists” – which prohibit those entities from doing business in the US – that included those companies.
Titled “Buying Influence in Washington: The Top Firms Lobbying for China”, the list – it was unclear who had compiled it – highlights some big players in the Washington lobbying scene. These included the Vogel Group and Avoq, retained by Chinese drone maker DJI; Akin Gump Strauss Hauer & Feld and Brownstein Hyatt Farber Schreck, retained by lidar maker Hesai Tech; and Steptoe & Johnson, retained by biotech firm BGI Group.
Photo: Reuters
How far did Janet Yellen’s trip move the ball for US-China relations?
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US Treasury Secretary Janet Yellen said the US had been able to ‘move the ball’ on key issues during her week-long trip to China
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Analysts said the trip focused on ‘practical short-term’ matters, including overcapacity concerns, money laundering and the mistreatment of US companies in China
The week-long trip to China by US Treasury Secretary Janet Yellen sidestepped core economic disputes, and without headway, analysts said the pressure of November’s presidential election could force the Biden administration “to be more aggressive” on the trade front.
Yellen ended her second trip to China in 10 months on Tuesday, having met Chinese officials and American business representatives in Guangzhou and Beijing over the past week, with the pressing issue of overcapacity having featured high on the agenda.
Photo: AFP
‘America is rising’: Biden uses State of the Union to push contest with China
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Annual presidential address has Biden appearing vibrant and confident about US, including its partnerships and alliances in the Pacific
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Although Biden administration ‘tried to take the temperature down’ on China, the Beijing challenge allowed him to talk about his domestic agenda, says analyst
“We want competition with China, but not conflict,” declared an energetic 81-year-old Joe Biden on Thursday during his last State of the Union address as US president before the country goes to the polls in November.
“We’re in a stronger position to win the competition for the 21st century against China, or anyone else for that matter,” he said, presenting a passionate case for a second term in the White House.
Photo: Reuters
Why is Trump now defending TikTok in the US after trying to ban it?
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Ex-president’s U-turn coincides with recent meeting held with billionaire Republican megadonor who is deeply invested in parent company ByteDance
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About-face could hurt presumptive 2024 Republican presidential nominee who has long touted his toughness on China, analysts say
Former US president Donald Trump has markedly changed his tune on TikTok, the popular short-video app that he once sought to ban over concerns about its Chinese ownership.
Throughout his term in the White House and in the run-up to the 2024 US presidential election, the presumptive Republican nominee with a reputation for mercurial moves has repeatedly touted his toughness on Beijing, citing trade tariffs he pushed the US to impose on China that remain in place.
Photo: Bloomberg
China’s 17-year run as top source of US imports ends as Mexico rises
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World’s second-largest economy also saw its share of American imports decline to 13.9 per cent in 2023, its lowest level in 20 years
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Total value of goods shipped from China to US fell by 20.3 per cent last year compared to 2022, as Mexico’s grew by 4.6 per cent
For the first time in 17 years, China was dethroned as the United States’ top source of imports, offering fresh evidence that Washington’s tariffs and supply-chain diversification efforts are bearing fruit.
Mexico outpaced China in 2023 in terms of total value of goods shipped to the US, according to data from the US Census Bureau released on Wednesday.
Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world.
Sign up now!