The U.S. shouldn’t scrap its Science and Technology Agreement (STA) with China when it expires later this month, and should instead update the deal to better address areas for cooperation around critical technologies, former U.S. officials and technology policy experts said this week. But they also acknowledged that continuing the agreement could be challenging, particularly because of rising tensions between the two sides along with a congressional push to restrict more American technology from being shared with Beijing.
Exports to China
The State Department this week announced penalties on one person and four entities and their subsidiaries for illegal transfers under the Iran, North Korea and Syria Nonproliferation Act. The agency in a notice said the parties transferred items subject to multilateral control lists that contribute to weapons proliferation or missile production. The State Department barred them from making certain purchases of items controlled on the U.S. Munitions List and by the Arms Export Control Act and will suspend any current export licenses used by the entities. The agency also will bar them from receiving new export licenses for any goods subject to the Export Administration Regulations. The restrictions will remain in place for two years from the July 19 effective date.
The Biden administration’s upcoming outbound investment screening rules should restrict both private and public investments, starting with “five to six priority sectors” but eventually expanding to more, said Rep. Mike Gallagher of Wisconsin, the top Republican on the House Select Committee on China. Gallagher said the rules should stop Americans from investing in Chinese entities connected to the country’s military, human rights abuses or “technological rise,” should require Chinese companies to meet the same due diligence standards as U.S. firms, and shouldn't be adjudicated through a case-by-case process, which would cause uncertainty for American investors.
The U.S. needs to better protect agricultural technology from Chinese theft and push Beijing to reduce tariffs on U.S. crops, American farmers told lawmakers last week. Speaking during a panel in Iowa organized by the House Select Committee on China, at least one farmer said U.S. trade policy should focus more on securing free trade deals, which would help exporters become less reliant on China.
Rep. Rick Larsen, D-Wash., one of the shrinking number of members of Congress who advocate for engaging with China rather than punishing it, recently published a white paper of his views on how to manage competition with China, how to use both offensive and defensive measures to compete with China, how to improve U.S. governance and competitiveness, and how to identify areas of cooperation.
China will rescind its antidumping and countervailing duties on imports of Australian barley, China’s Ministry of Commerce announced Aug. 4, according to an unofficial translation. The duties had “effectively blocked” Australian shipments of barley since the measures were first announced in 2020, Australia’s Trade Minister Don Farrell said in a statement welcoming the news. “The removal of duties is the result of work by government and industry to resolve this matter,” Farrell said. China said the duties were officially removed Aug. 5.
Two U.S. Navy servicemembers, Jinchao Wei and Wenheng Zhao, were arrested in California as part of two separate cases for "transmitting sensitive military information" to China, DOJ announced Aug. 3.
House Republicans this week urged the Biden administration not to strike a deal with Beijing after Chinese officials reportedly offered to restart counter-narcotics activities with the U.S. in exchange for lifting certain trade restrictions. Beijing asked the U.S. to lift restrictions on the Ministry of Public Security’s Institute of Forensic Science, The Wall Street Journal recently reported. The institute was added to the Entity List in 2020 for its ties to human rights violations.
The House Select Committee on China is investigating U.S. investment firms BlackRock and index provider MSCI for their “decisions” that led to Americans investing savings into “dozens of blacklisted Chinese companies,” including entities that contribute to China’s human rights abuses, the committee said this week. In letters to the two firms, committee leaders said their investment-related decisions have resulted in Americans “unwittingly funding” Chinese entities building weapons for the country's military and contributing to the government's goal for “technological supremacy.”
China will soon impose export controls on certain unmanned aerial vehicles and related equipment in what is said is an effort to safeguard its national security. The restrictions, effective Spet. 1, will cover certain UAVs and their engines, infrared imaging equipment, radars, lasers, radio communication equipment, jamming equipment and more, China’s Ministry of Commerce announced July 31, according to an unofficial translation. It added that “all other civilian drones that are not included in the control are prohibited from being exported for military purposes.”