US Commerce Secretary Gina Raimondo will visit China next week at a critical time for the world’s second-largest economy — and for the Biden administration’s relationship with the country and its leaders.
China’s economy is in trouble, and some economists and market analysts fear the contagion could spread beyond the country’s borders.
Chinese consumer prices are falling, a real estate crisis is deepening, exports are slumping, youth unemployment is at a record high, and Hong Kong’s stock market has tumbled more than 20% from its January peak. Last week, the Chinese yuan fell to its lowest level in 16 years. All that could help tame US inflation, but it also raises the risk of a recession.
Officials are taking action by lowering interest rates and attempting to shore up the property market. But economists have said President Xi Jinping’s government hasn’t gone far enough, and its intervention lacks the forcefulness of the stimulus program that helped China’s economy bounce back from the global financial crisis.
Meanwhile, China continues to crack down on US and other foreign companies doing business in the country, and a tit-for-tat battle for the future of AI and other technologies that governments around the world believe are critical for national security is escalating.
Raimondo’s trip to Beijing and Shanghai, which will take place from August 27 through August 30, will follow recent visits from several other Biden administration officials, including Secretary of State Antony Blinken, Treasury Secretary Janet Yellen and Climate Envoy John Kerry. President Joe Biden met with Xi in November.
“Secretary Raimondo looks forward to constructive discussions on issues relating to the US-China commercial relationship, challenges faced by US businesses, and areas for potential cooperation,” the Commerce Department said Tuesday in its announcement. She’ll meet with senior Chinese government officials and US business leaders, the department said.
Along with the Treasury Department and US Trade Representative, Raimondo’s Commerce Department helps set America’s global trade policy — a sticking point in US-China relations since the Trump administration increased tariffs on a range of goods coming from China.
Maintaining a dialogue while ramping up competition
In previous visits, other Biden administration officials aimed to reopen lines of communication and ease tensions that have risen between the two countries in recent years. The Biden administration has said it wants to maintain dialogue with China to prevent competition from turning into conflict.
Yet both countries continue to erode the vital economic ties that connect the world’s top two economies. The White House earlier this month detailed new rules limiting US investments in advanced technology industries in China, including chipmaking. And Beijing has displayed growing distrust of foreign companies, even as multiple senior officials have sought to roll out the red carpet for them to invest in China amid an economic slowdown.
On Tuesday, China fined Mintz Group, an American corporate due diligence firm, about $1.5 million for allegedly conducting unapproved statistical work in the country. It’s part of China’s ongoing nationwide crackdown on consulting firms in the name of national security.
In late April, Beijing tightened its counter-espionage law and expanded the list of activities that could be considered spying, increasing the risks for international firms.
Raimondo’s visit also comes on the heels of the revelation that Chinese-based hackers infiltrated the Commerce Secretary’s emails.
— CNN’s Laura He contributed to this report