Confrontational Strategic Competition Act Is Set to Pose More Stumbling Blocks for Future China-U.S. Ties

On April 21, after hours of debate and several amendments, the U.S. Senate Committee on Foreign Relations voted 21-1 in approval of the Bill to Address Issues Involving the People’s Republic of China, also known as the Strategic Competition Act of 2021.

The over 280-page bill was based on the Strengthening Trade, Regional Alliances, Technology, and Economic and Geopolitical Initiatives Concerning China Act proposed by Jim Risch, then Chairman of the committee, and three other Republican senators in July 2020. As the Republicans lost control of the Senate after the 2020 elections, Democrat Robert Menendez took over the panel’s chairmanship and proposed the new bill.

At an earlier hearing, Menendez had already stressed that the right basic framework for thinking about the U.S.-China relationship would be that of “strategic competition,” entailing a new set of organizing principles to address “the challenges of this new era.”

Focal points

The U.S. legislation accuses China of leveraging its political, diplomatic, economic, military, technological and ideological powers to challenge the interests and values shared by the U.S. and its partners. In doing so, the U.S. claims that China is jeopardizing the rules-based international order characterized by freedom. According to this act, China’s objectives are to “first establish regional hegemony over the Indo-Pacific” and subsequently use that dominant position to propel it to become the world’s “leading power.” Based on this, China would redefine international laws and regulations and encourage other countries to follow its governance model, the bill states.

Going by this assessment, the bill sets several objectives for the U.S., one of which is to sustain its global leadership role by leveraging its tools for long-term political, economic, technological, and military competition with China. The bill clearly states that the Congress will strengthen U.S. domestic infrastructure by investing in market-based economy, education, and innovation, as well as ensure the U.S.’ leading role throughout this process.

It also lays out the key areas of U.S. strategic competition with China. First, to deepen alliances by prioritizing the Indo-Pacific region and Europe in pursuit of greater multilateral cooperative initiatives that advance “shared interests and values.” Second, to promote “universal values,” “human rights and labor rights” and adopt sanctions against China regarding its policies on Hong Kong and Xinjiang. Third, to control China’s so-called “predatory economic practices,” including those of “intellectual property theft,” “using Hong Kong to circumvent U.S. export control” and “reviewing the presence of Chinese companies in U.S. capital markets.” Fourth, to enhance U.S. competitiveness by investing in technology, infrastructure, digital connectivity and “cybersecurity partnerships.” Fifth, to advance military cooperation with allies in the face of the modernization of China’s army.

This act not only refers to Taiwan as a core partner of the U.S. in the field of science and technology, but also “recognizes Taiwan as a vital part of the U.S. Indo-Pacific strategy.” Moreover, it claims that “to advance the security of Taiwan and its democracy” is “a vital national security” of the U.S. It requires the Department of State and other U.S. government agencies to engage with Taiwan authorities “on the same basis, and using the same nomenclature and protocol, as the U.S. Government engages with other foreign governments.” Such statements demonstrate the intention of some American politicians to abandon the one-China policy, the red line of China, in an attempt to transform the “strategic ambiguity” of the U.S. on Taiwan to “strategic clarity.”

Far-reaching impacts

The Strategic Competition Act of 2021 is arguably the most important U.S. bill regarding China in the 21st century thus far, even the most vital one since the founding of diplomatic ties between the two countries in 1979. Spanning the administrations of Donald Trump and Joe Biden, it contains a bipartisan consensus. Its legislation process will not be too time-consuming, thus it might possibly be passed before the end of this year.

It is clear that the China policies of the Congress and the Biden administration will merge more rapidly. The lawmakers are pushing hard to highlight two main priorities in terms of the strategic competition with China. One is to maintain the U.S. leading power and its competitive edge; the other to contain and suppress China.

The Biden administration, in office for more than three months at this point, has early on set the tone of its policy toward China, namely long-term strategic competition. Under the guidance of this keynote, it has opted to pressure China across economic, technological and military fronts and on issues related to values. Meanwhile, it has reiterated its refusal to enter a new cold war or any other form of confrontation and underlined the importance to set boundaries for competition and implement management mechanisms that will help avoid conflicts. In reference to the China policy, U.S. Secretary of State Antony Blinken said that the U.S. will compete, collaborate and confront as deemed necessary. That means the Biden administration will deal with different issues in different ways, and will not let differences between the two countries obstruct bilateral coordination on issues like climate change and nuclear non-proliferation among others.

It is not hard to see that the current White House stance echoes the voices from Capitol Hill. In future dealings with China, the Biden administration will largely leverage the Capitol’s opinions and policy orientations to increase pressure on China, but it might also be reined in by the Congress when cooperating with China.

Furthermore, the act also requires the improvement of U.S. strategic competitiveness via practical measures such as the restructuring of global supply chains to reduce its reliance on China. This implies that the U.S. might force production of key tech products to relocate from China to the U.S. and its allies and partners by using a combination of moral, legal, institutional, public opinion and political pressure.

According to the act, the secretary of state, in coordination with the secretary of commerce, is authorized to establish a program that facilitates contracting by U.S. embassies for the professional services of qualified experts to assist both U.S. citizens and business entities in exiting China.

Meanwhile, the legislation also homes in on the competition with China in terms of overseas infrastructure construction. The proposed Global Infrastructure Coordinating Committee is expected to up synergy of efforts from the Department of State, the Department of Commerce, the Department of Treasury, the Department of Energy, the Department of Transportation, the U.S. Agency for International Development and other official entities, to catalyze global private sector investments as well as the deployment of U.S. government technical assistance and development finance tools, including project preparation services and commercial advocacy.

Fragile, incentives

Both the Democrats and Republicans have also shown high consistency on economy, trade and technology, among other key competition areas with China. For example, the Creating Helpful Incentives to Produce Semiconductors for America Act and the Endless Frontier Act are under high-speed Congress review. The former will pour multibillion dollars into semiconductor manufacturing incentives and research initiatives to strengthen American leadership in chip technology. The latter calls for $110 billion over a period of five years to upgrade U.S. technology efforts in their competition with China. Going forward, China-U.S. technological, economic and trade interactions might face multiple legal stumbling blocks.

The legislation of the Strategic Competition Act of 2021 itself is a process of accelerating the mobilization of the U.S. competition strategy against China. Even when passed, it will not necessarily exert the sufficient and factual legally binding forces on the Biden administration’s actions. Nevertheless, it will cement the U.S. long-term strategic competition standpoint on China, posing far-reaching implications for future bilateral ties.

Finally, the U.S., along with allies and partners, says it should lead an international effort to combat “digital authoritarianism.”

China should be aware that the accusations of China’s so-called “digital authoritarianism” and “Indo-Pacific hegemony” as well as many others are only excuses created by certain American politicians to adopt conservative and “America first” diplomacy. After all, the confrontational legislation of Capitol Hill is not a policy drafted by the Biden administration. Washington can neither go against the trend of globalization nor erect fences to cut off China from the world.

China should focus on developing itself and staying on the path of socialism with Chinese characteristics under the leadership of the Communist Party of China. If competition with the U.S. becomes inevitable, then it should be managed properly to avoid any hard confrontation, a prerequisite for China’s overall development.

The author is an op-ed contributor to Beijing Review.

Liu Guozhu, a professor of U.S. studies at Zhejiang University, contributed to this article.