U.S. lawmakers and officials are crafting proposals to push American companies to move operations or key suppliers out of China that include tax breaks, new rules, and carefully structured subsidies. Interviews with a dozen current and former U.S. government officials, industry executives and members of U.S. Congress show widespread discussions underway — including the idea of a “reshoring fund” originally stocked with US$25 billion — to encourage U.S. companies to drastically revamp their relationship with China. U.S. President Donald Trump has long pledged to bring manufacturing back from overseas, but the recent spread of the coronavirus and related concerns about U.S. medical and food supply chains dependency on China are “turbocharging” new enthusiasm for the idea in the White House. Trump signed an executive order last week that gave a U.S. overseas investment agency new powers to support manufacturers in the United States. The goal, Trump said, is to “produce everything America needs for ourselves and then export to the world, and that includes medicines.” But the Trump administration itself remains divided over how best to proceed, and the issue is unlikely to be addressed in the next fiscal stimulus to offset the coronavirus downturn. U.S. Congress has begun work on another fiscal stimulus package but it remains unclear when it might pass. Both Republicans and Democrats are crafting bills to decrease U.S. reliance on China-made products, which accounted for some 18 percent of overall imports in 2019. The medical supply chain and defense-related goods are top of the list. “Coronavirus has been a painful wakeup call that we are too reliant on nations like China for critical medical supplies,” said U.S. Senator Lindsey Graham in a press release Friday. He is expected to issue a new bill this week. A controversial idea being floated in Washington would allocate as much as US$25 billion to companies that make essential goods to move production home, ensuring that even products far down the supply chain were sourced domestically, according to two administration officials.(SD-Agencies) |