Updated March 3, 2021
China Primer: U.S.-China Relations
Overview
billion between 2018 and 2020. Foreign direct investment
In its early statements, the Joseph R. Biden Administration
(FDI) flows have slowed since 2017, while other ties not
has signaled significant continuity with the Donald J.
captured in trade and FDI data have expanded, including
Trump Administration in its characterization of the
financial investments and China’s use of U.S. open source
challenge the People’s Republic of China (PRC or China)
technology platforms. U.S. concerns about China’s trade
poses to U.S. interests. President Biden has referred to
practices center on the expansive role of the state in China’s
China as “our most serious competitor,” stated that China is
economy, China’s domestic restrictions in sectors in which
challenging “our prosperity, security, and democratic
China is expanding overseas, and China’s efforts to export
values,” and called on allies and partners to “prepare
its rules and standards globally. China has been largely
together for long-term strategic competition with China.” In
unwilling to acknowledge and address U.S. concerns, which
written responses to questions from Senators, then-
are now evolving into broader considerations about how
Secretary of State-nominee Antony J. Blinken described
China’s actions may challenge U.S. competitiveness and
China as “engaged in conduct that blunts our technological
national security. The Coronavirus Disease 2019 (COVID-
edge, threatens our alliances and our influence in
19) pandemic exposed supply chain risks and prompted
international organizations, and is designed to make
Congress to advance legislation, such as P.L. 116-136, to
America and its allies more dependent on China, and China
encourage diversification, transparency, and some on-
less dependent on America and our allies.” Secretary of
shoring. A February 2021 Executive Order (E.O.) directs an
Defense Lloyd Austin, at his own confirmation hearing,
assessment of critical U.S. supply chains, building on
called China “the most significant threat going forward.”
related Trump Administration E.O.s.
China is “already a regional hegemon,” he said, and it seeks
to become “the preeminent power in the world in the not-
In 2018, the Trump Administration, acting under Section
too-distant future.”
301 of the Trade Act of 1974 (19 U.S.C. §2411), concluded
that China engages in forced technology transfer, cyber-
As it reviews the Trump Administration’s China actions,
enabled theft of U.S. intellectual property (IP) and trade
the Biden Administration has pledged to meet the challenge
secrets, discriminatory and nonmarket licensing practices,
from China by working closely with U.S. allies and
and state-funded strategic acquisitions of U.S. assets. In
partners; re-engaging with the United Nations; ensuring the
response, it increased tariffs on approximately $250 billion
U.S. military’s ability to present a credible deterrence to
of imports from China. The PRC countered with tariffs on
China; putting democratic values at the center of foreign
$110 billion worth of U.S. products. Most tariffs remain in
policy; and making investments at home in American
effect. The United States and China signed a phase one
workers, infrastructure, education, and innovation. National
agreement in January 2020, in which China committed to
Security Advisor Jake Sullivan has acknowledged that
strengthen IP enforcement and remove some barriers, but
forging a common position on China with European allies
left most U.S. concerns unresolved. China committed to
will be challenging “because we don’t have entirely aligned
buy $468 billion of U.S. goods, energy, agriculture, and
perspectives.” Forging a common position with Asian allies
services over two years, but its purchases fell short in 2020.
could be more challenging still, given their competing
strategic aims and their geographic proximity and close
Technology
economic ties to China.
To address China’s industrial policies that seek civilian and
military technology leadership, the Trump Administration
In their overtures to the Biden Administration, China’s top
sought to curtail U.S. technology transfer to China. It
leader and other senior officials have called for dialogue
increased scrutiny of academic ties, strengthened
and cooperation, while also warning the United States to
investment review authorities, tightened export controls,
keep out of China’s “internal affairs.” In February 2, 2021,
and banned U.S. investment in firms tied to China’s
remarks, China’s top diplomat advised the United States to
military. It banned PRC firms Huawei, China Mobile, and
“respect China’s positions and concerns” on Taiwan, “stop
China Telecom from the U.S. market and encouraged other
interference” in Hong Kong, Tibet, and Xinjiang affairs,
countries to follow suit. Then-Secretary of Commerce
and “stop attempts to hold back China’s development,”
nominee Gina Raimondo declined to take a position on
calling those issues “a red line that must not be crossed.”
China technology issues during her confirmation hearing.
The prominence of these issues has focused attention on
Select Issues in U.S.-China Relations
possible nominees for Undersecretary of Commerce for
Industry and Security and their approach to dual-use
Trade and Investment
technology policy and licensing. The White House has said
China was the United States’ largest goods trading partner
it will not let PRC vendors of concern into the U.S. market
in 2020, even as U.S. imports from China fell by $100
but has not addressed export controls and restrictions. It is
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China Primer: U.S.-China Relations
reviewing the Trump Administration’s bans on U.S.
Security Law on Hong Kong that many see as breaking
investment in Chinese military firms and on Russian and
those promises. The Trump Administration ended Hong
Chinese equipment in the U.S. power grid.
Kong’s separate trade treatment and sanctioned certain
Overseas Infrastructure
officials. In February 2021, after Hong Kong charged pro-
democracy politicians and activists with subversion under
Responding to China’s “One Belt, One Road” program,
the new law, Secretary of State Blinken called for their
which seeks to expand China’s global commercial ties and
immediate release, tweeting, “Political participation and
influence, mostly through infrastructure projects, Congress
freedom of expression should not be crimes.”
passed the Better Utilization of Investments Leading to
Development (BUILD) Act of 2018 (P.L. 115-254) and
Taiwan
reauthorized the U.S.-Export Import Bank. The Trump
Since switching diplomatic recognition from Taipei to
Administration developed the Infrastructure Technology
Beijing in 1979, the United States has maintained unofficial
Assistance Network, the Transaction Advisory Fund, and
relations with self-ruled Taiwan, over which China claims
the Blue Dot Network to promote competitive projects.
sovereignty and with which China has vowed to unify. The
Climate Change
Biden Administration State Department has urged Beijing
“to cease its military, diplomatic, and economic pressure
On March 2, 2021, Special Presidential Envoy for Climate
against Taiwan and instead engage in meaningful dialogue
John Kerry called for climate change to be treated as “a
with Taiwan’s democra
compartmentalized issue” in U.S.
tically elected representatives” and
-China relations, but
referred to the U.S. commitment to Taiwan as “rock-solid.”
acknowledged that it may be hard to “disentangle” it from
In his written responses to Senators, Blinken indicated that
other issues in the relationship. He previously pledged not
he would keep in place his predecessor’s revocation of all
to trade issues on which the two countries have differences
State Department-issued guidelines on contacts with
for climate goals. Kerry has called China’s financing of
Taiwan until the department completes a review and
coal-fired power plants under its One Belt, One Road
finalizes “updated guidance to reflect our commitment to
initiative “a bone of contention.” The White House is to
deepening ties with Taiwan.”
host a Leaders’ Cli

mate Summit on April 22, 2021.
East and South China Seas
The COVID-19 Pandemic
In a call with Japan’s Prime Minister, President Biden re-
COVID-19 was first identified in China in late 2019. In
affirmed that the U.S.-Japan Treaty of Mutual Cooperation
2020, the Trump Administration announced a decision to
and Security covers the Senkaku Islands, uninhabited East
withdraw the United States from the World Health
China Sea rocks administered by Japan but also claimed by
Organization (WHO) over concerns about WHO’s
the PRC and Taiwan. Separately, Secretary Blinken told his
interactions with China in the early months of the
Philippine counterpart that the U.S.-Philippine Mutual
pandemic. The Biden Administration reversed that decision.
Defense Treaty applies to armed attacks against Philippine
In a February 13, 2021, statement, the White House stated
armed forces, public vessels, and aircraft in the Pacific,
that “re-engaging the WHO also means holding it to the
including the South China Sea (SCS). Referring to SCS
highest standards.” The statement raised “deep concerns”
sovereignty disputes, Blinken committed “to stand with
about a WHO team’s investigation into the origins of the
Southeast Asian claimants in the face of PRC pressure.”
pandemic and insisted that its final report include “expert
Fentanyl and Other Synthetic Opioids
findings free from intervention or alteration by the Chinese
government.”
China has been a major source of the fentanyl and fentanyl-
The Biden Administration has separately
related compounds contributing to the U.S. opioid crisis.
pledged to send U.S. public health experts back to China.
Under pressure from the United States, China in 2019
China’s Treatment of Muslim Minorities
imposed domestic controls on the entire fentanyl class of
synthetic opioids, including all known and potential future
On its last full day in office, the Trump Administration
variations of fentanyl. Since then, U.S. law enforcement
issued a determination that China had committed crimes
officials have reported an apparent shift in fentanyl
against humanity and genocide “against the predominantly
production to include other countries, such as India and
Muslim Uyghurs and other ethnic and religious minority
groups” in China’s
Mexico. The U.S. government continues to press China to
Xinjiang region. Earlier U.S. actions on
control precursor chemicals used to manufacture fentanyl.
Xinjiang included adding PRC entities to the Department of
Commerce’s Entity List; imposing sanctions on certain
Select Legislation in the 116th and 117th Congresses
PRC officials and entities; and blocking imports from China
The first China-related legislation ordered to be reported in
tied to forced labor. Blinken has said he concurs with the
the 117th Congress is H.Res. 130, which would condemn
“genocide” determination. He has emphasized the need to
the “continued violation of rights and freedoms of the
prevent the import of goods made with forced labor and the
people of Hong Kong.” Acts related to China passed in the
export of technologies used for repression.
116th Congress include those on Hong Kong (P.L. 116-76;
P.L. 116-77; P.L. 116-149), Uyghurs (P.L. 116-145), Tibet
Hong Kong
(P.L. 116-260), Taiwan (P.L. 116-135; P.L. 116-260),
Hong Kong, a former British colony, reverted to PRC
fentanyl (P.L. 116-114), communications networks (P.L.
sovereignty in 1997 under the provisions of a 1984 treaty in
116-124), and foreign issuers of securities (P.L. 116-222).
which China promised the city a “high degree of
autonomy” and stated that Hong Kong’s social and
Susan V. Lawrence, Specialist in Asian Affairs
economic systems would remain unchanged for at least 50
Karen M. Sutter, Specialist in Asian Trade and Finance
years. In June 2020, China imposed a sweeping National
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China Primer: U.S.-China Relations

IF10119


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https://crsreports.congress.gov | IF10119 · VERSION 45 · UPDATED

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