US financial tools to help deal with China - photo 1

US financial tools to help deal with China | World

As the lending service leverages Chinese President Xi Jinping’s Belt and Road initiative, China has gradually gained influence in many developing countries. This situation has made Washington concerned that Beijing is challenging the US position globally, according to the paper South China Morning Post.

“Focus on the challenges from China”

From the above concern, on December 20, 2019, the then President of the United States, Donald Trump, signed to promulgate a bill authorizing the US Export-Import Bank (EXIM) to carry out financial services for another 7 years, to May 9.2026. “I thank President Trump for making history today by signing the longest authorization to EXIM in its 85-year history,” said EXIM President Kimberly A. Reed or in a statement posted on the EXIM website. “The bill signed into law by the President also sets the direction for EXIM to focus on important economic challenges and national security from China”, Ms. Reed emphasized in the announcement.

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Before that, EXIM fell into a “frozen” state for about 5 months, from July 1, 2015, not allowed to provide new loans, after Congress failed to pass a bill to further authorize the bank. this. In December 2015, US President Barack Obama signed a bill to allow EXIM to operate until September 2019, but can only provide loans for small export contracts until the Senate is controlled by the Republican Party. then through the nominated candidates to the EXIM board, according to the sheet The New York Times. However, in 4 years, up to 2019, many Republican senators have refused to approve leadership for EXIM, according to the report. The Wall Street Journal.

During the 2016 election campaign, Mr. Trump and many conservative Republicans said that EXIM was “unnecessary”, but later saw the bank as a tool to support US manufacturers and support banks. compete with China, according to the sheet The Wall Street Journal.

Recently, the sheet South China Morning Post According to EXIM’s website, according to its China program, EXIM offers loans, guarantee services and financial insurance that are “competitive with the rates, terms and other terms of People’s Bank of China ”and prioritizes in 10 areas, including artificial intelligence, robotics, biotechnology, biomedical science and wireless communication equipment.

Former President of US Export Import Bank (EXIM)

EXIM’s China program achieved rapid success. With EMIX’s support after a few months of full reinstatement, Pennsylvania’s Air Products & Chemicals company won a contract to export liquefied gas to Mozambique, avoiding the deal that would probably fall. into Chinese or Russian hands. The decision was made in March 2020, when Mozambique switched to choosing an American company after borrowing $ 4.7 billion from EXIM. This is the largest loan in the 87-year history of this bank.

Empowering EXIM

In a letter to EXIM in August 2020, then US Secretary of State Mike Pompeo emphasized, “EXIM must take necessary action to neutralize the PRC export subsidies, support US exports in 5G technology and Other technologies important to our national security and prosperity ”through EXIM’s China program.

At the December 2020 meeting on national security issues at the White House, then US Commerce Secretary Wilbur Ross emphasized the importance of giving EXIM more power to lend to China. That same month, US congressmen, including ex-critics of EXIM, passed some of the most drastic changes in EXIM’s history to further grant lending rights to the bank.

During the G-7 meeting in mid-December 2020, Canada, France, Germany, Italy, Japan and the UK all expressed concern about China’s rise in state-backed lending because it gives its advantage. for Chinese companies. Chairman of EXIM Reed said that governments need to change their way of doing business, otherwise their exporters will be at risk of losing access to large shares of important markets. Recently, US lawmakers asked EXIM to spend at least $ 27 billion on the China program to provide guarantees, services and insurance at levels and conditions that compete with what Beijing does. welcome.

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When President Joe Biden took office on January 20, Mrs. Reed resigned, but EXIM remained safe until the end of September 2026, when the authorization period for the bank expired and parliamentary re-authorization is required. Also, under the Biden administration, it is clear that China remains the top strategic opponent for the United States, according to South China Morning Post. President Biden’s national security advisor Jake Sullivan is silently restructuring the National Security Council in a way that focuses on dealing with China, according to POLITICO magazine. Last month, Mr. Sullivan also revealed that the Biden administration’s strategy on China will “include the government’s investment in artificial intelligence, biotechnology, clean energy and the public sectors. other technology that China hopes to dominate, ”said South China Morning Post.


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