The US Senate has passed the “American Competition and Innovation Act” bill. The bill is a rare bipartisan bill on June 8 aimed at countering China’s growing influence with investments of more than $200 billion in technology, science and research.
|China creates conditions for the US to continue exporting rare earth ores.|
The bill, with 68 votes in favor and 32 against, still needs to be passed in the US House of Representatives before being moved to President Joe Biden’s desk to sign into law.
Under the bill, about $250 billion would be spent on American manufacturers and the tech industry over the next five years.
According to The New York Times, that includes $52 billion for a grant fund for semiconductor manufacturers, and about $190 billion in funding for new technology research across the United States.
The bill also requires iron, steel, manufactured products and construction materials used in federally funded infrastructure projects to be manufactured in the United States.
The bill passed just hours after the Biden administration announced new steps to strengthen US supply chains. On June 4, US President Joe Biden signed an executive order to blacklist 59 Chinese military and surveillance companies, preventing them from accessing US investments. Prior to this move, only 44 such Chinese companies were subject to US sanctions.
Under the expanded decree, listed Chinese companies “undermine the security or democratic values” of the US and its allies.
The White House also published a supply chain review purporting to look at expanding US production of lithium batteries, semiconductors, rare earth minerals and active pharmaceutical ingredients.
On June 8, Reuters quoted senior officials in the administration of President Joe Biden as saying the administration would create a “supply chain trade task force” to tackle unfair issues in trade, in the It has relations with China.
The force will be led by Trade Representative Katherine Tai and will examine specific violations that have drained US supply chains over time.
Senate Majority Leader Chuck Schumer described the legislation as aimed at countering China’s influence on many fronts and would spur American innovation and maintain the competitive edge of the world’s top economy. for future generations.
Schumer said that whoever wins the race for the technologies of the future will become the global economic leader with profound implications for foreign policy and national security.
In a related development, China’s Ministry of Finance on May 17 said that the country will continue to exempt import duties on 79 goods from the US. Among these are rare earth ore, gold ore and medical sterilization equipment will continue to be exempt from tax from May 18 to December 25.
This means that China will continue to import rare earth ores from the US and process the material separately. In the US, mines used to treat rare earths, but were closed due to financial and environmental problems. Meanwhile, the machines that can process rare earth ore in the world are owned by China.
So far, the US has not grasped the ownership of the technology and the difficulty of rebuilding the rare earth industry. The investment in science and research also serves this purpose.