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The Paradox of Protectionism

9 0
29.05.2024

The Biden administration’s expansion of tariff rates on Chinese manufactured goods risks undermining the “free and open Indo-Pacific” that he pledged to defend. By applying tax rates of up to 100 percent on Chinese goods, the Biden team is not only preventing Chinese exports to the United States but also disrupting regional trade and supply networks, including those involving key U.S. allies and partners.

In doing so, the White House’s industrial policies are undermining economic integration and shared growth in Asia, arguably the single biggest contributor to peace and stability in the Indo-Pacific since the end of the Cold War. The implications for long-term U.S. strategic engagement in the Indo-Pacific are profound.

The primary contradiction in the administration’s Indo-Pacific policies lies in the region’s value chains (RVCs), which are the densest in the world, particularly in high-tech sectors. While RVCs in Europe and North America have declined in recent years, those in “Factory Asia” have noticeably increased due to China’s economic centrality in the region.

Therefore, any effort to limit Chinese exports will inevitably impact other regional states, especially as China has prioritized RVC expansion and economic integration across Asia. For example, tariffs on batteries, battery components, and critical minerals will impact Southeast Asian states like Indonesia, Malaysia, and Thailand. These countries are integrated into Chinese-centric RVCs and will face higher........

© The National Interest


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