Saturday, May 30, 2020

Coronavirus Impact: American senators urge Trump to counter China’s economic policy

Alleging that China's state-owned and state directed enterprises are looking to exploit the current economic crisis caused by the coronavirus pandemic buying US and foreign companies, the bipartisan group of senators have urge the Trump administration to counter China's international predatory economic behaviour.

Washington: The global coronavirus pandemic has seen the already strained ties between the USA and China plunge to new lows with the rivalry threatening ti erupt into a full blown trade war.

US president Donald Trump has accused China of deliberately creating the COVID-19 virus in a Wuhan laboratory and spreading the coronavirus outbreak around the world.

Several countries has supported this US assertion, claiming that it was a deliberate step by the Chinese government, which was intended to suppress the economic growth of the entire world and help China achieving its goal of becoming the most dominant economic power.

Trump has threatened to cut off all relations with China even as several multinational companies have announced their intentions to relocating their operations in China to other countries.

The US Senate has now passed a legislation that could ban Chinese companies from listing shares on American exchanges.

The legislation may also ban Chinese companies from raising funds from American investors.

Now a bipartisan group of top American senators has urged Trump to take further action against China.

Alleging that China’s state-owned and state directed enterprises are looking to exploit the current economic crisis caused by the coronavirus pandemic buying US and foreign companies, the bipartisan group of senators have urge the Trump administration to counter China’s international predatory economic behaviour.

“As we confront the current public health crisis, we must ensure countering the PRC’s predatory economic behaviour both at home and abroad continues to feature in policy deliberations. It was important six months ago, remains important today, and must continue to be a US priority in the future, the senators wrote in a letter to the US Treasury Secretary Steven Mnuchin.

Signatories to the letter were Senators Mitt Romney, Marco Rubio, Thom Tillis, Ben Sasse, John Cornyn, Tom Cotton and Jeff Merkley.

We write to express our concerns related to the People’s Republic of China’s (PRC) efforts to exploit the economic crisis wrought by the COVID-19 pandemic to gain control of distressed companies or shirking its international responsibilities amidst a worldwide crisis, the Senators said.

In both Chinese Communist Party (CCP) and PRC policy documents, Beijing has made no secret of its intentions to dominate strategic industrial and emerging technology sectors as well as influence standards at the expense of liberal, rules-based governance, they said.

Moreover, as the crisis reverberates across the globe, the PRC’s predatory lending practices, including the use of non-disclosure agreements for bilateral loans, not only damage the fiscal situation of recipient countries but also undermine the international community’s ability to respond effectively to the crisis, the letter said.

Without US and international pressure for accountability and transparency, those countries that are in debt to the PRC will not have the political cover or protection to open their financial books, the Senators felt.

Such countries will face the risk of default or a currency crisis, leaving the International Monetary Fund (IMF), World Bank, and Western countries to clean up the PRC’s mess, they said.

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