It is a pleasure to be back with you. I appeared before the International Trade Committee of the European Parliament about four years ago when I was Deputy Director-General of the WTO. Cecilia Malmström testified at the same meeting, and she is now a colleague of mine at the Peterson Institute.
America's Trade Priorities
The principal overriding foreign economic policy issue for the Biden administration is competition with China. A second immediate priority is the necessity to maintain effective policy measures to deal with Russia's invasion of Ukraine.
Competition with China is seen to require:
- strengthening the domestic economy,
- direct measures with respect to trade with China, and
- working with those with aligned interests to deal with China.
The one clear area of White House and Congressional alignment after the mid-term election remains alignment on the need to counter China. Public support for this position is also strong.
A successful aspect of US foreign policy has been working with allies to support Ukraine and undermine the Russian war effort.
It is not clear how far the alignment of nations present with respect to economic relations with Russia will extend to a uniform approach to dealings with China. All the actors without exception—those countries trading with China and those receiving investments from China or having received them from China—have mixed interests. Most countries do not buy fully into a Manichean world, divided into two camps, one to conform policies with and the other to shun.