Biden's trade chief pick dodges question on rejoining TPP
Nikkei Asia (26/02/2021) - NEW YORK -- Katherine Tai, a former trade enforcer and litigator against Beijing now poised to be confirmed as U.S. trade representative, vows to counter China in a world that she says is "very different in important ways" from when the Trans-Pacific Partnership was signed.
"China is simultaneously a rival, a trade partner and an outsized player whose cooperation will also need to address certain global challenges," the Taiwanese American attorney said in the opening statement at her confirmation hearing Thursday before the Senate Finance Committee. "We must remember how to walk, chew gum and play chess at the same time."
If confirmed, Tai will assume the top U.S. trade post at a time when Washington is left out of the Asia-Pacific region's largest trade pacts: the Regional Comprehensive Economic Partnership and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
China is part of RCEP, whose members make up 30% of the world's economic output, and is eyeing access to the CPTPP. The U.S. withdrew itself from the predecessor of the CPTPP under then-President Donald Trump. The administration of President Joe Biden has said Washington will not enter into any new free trade deals before making significant investment domestically.
But some lawmakers in the hearing seemed eager for the would-be trade chief to lead the U.S. back to the negotiating table soon to reengage with the Asia-Pacific region. "It's not just our allies that are moving forward," said Sen. Mike Crapo, the top Republican on the committee, pointing to China's inclusion in RCEP.
Asked if the U.S. could soon go back to the TPP or a similar deal, Tai said "the formula for TPP" -- working with partners with shared economic and strategic interests, with the challenge of China in mind -- is still "a solid equation."
But "a lot has changed in the world in the past five or six years," she added. "And a lot has changed in terms of our own awareness about some of the pitfalls of the trade policies that we've pursued."
Trump had called the TPP a "job killer" and withdrew from it in his first week in office. Biden's Democratic Party has also been hesitant to embrace the trade pact.
Working with trusted partners to counter China's rising influence in Asia and elsewhere has been the cornerstone of Biden's foreign policy vision, and that will also be applied to trade.
"I know the opportunities and the limitations in our existing toolbox," Tai said in her testimony. "And I know how important it is to build what the president has termed a united front of U.S. allies."
Looking to Washington's challenges ahead, Tai highlighted the Chinese economy's increasingly prominent feature of state capitalism, which makes Beijing an "extremely formidable competitor."
With its traditional focus on and trust in the free market, the U.S. needs to revisit how it conducts its economic activity and trade policies, "not to become China" but to be more strategic and clear-eyed about the challenge it is up against, she said.
Strengthening domestic industries and placing American workers at the center of Washington's trade policy will be an important piece of that strategic thinking, according to Tai and the Biden administration.
The Yale- and Harvard-educated Mandarin speaker has extensive qualifications praised by lawmakers on both sides of the aisle. Currently chief trade counsel to the House Ways and Means Committee, Tai once served as the U.S. trade representative's chief enforcer against China and litigated cases against Beijing at the World Trade Organization.
Her trade experience both on the legislative side and in enforcement will enable her to hit the ground running immediately upon confirmation.
But Tai also was also quick to manage expectations on Washington's ability to push for structural changes in the Chinese economy and its trade practices.
"I think it is absolutely worth exploring with China but I also want to note that those are conversations and those are roads that have been well worn by U.S. trade representatives before me," Tai said. "And so on this issue of the U.S.-China trade relationship, I would like to say that we need to be exploring all of our options."
At the hearing, Tai also discussed her family background. Her parents were born in mainland China but grew up in Taiwan before moving to the U.S. for graduate school. Her father became a medical researcher at Walter Reed National Military Medical Center in Washington. Her mother, who attended Thursday's hearing, develops opioid addiction treatments at the National Institutes of Health.