In Congress, concern has mostly focused on Chinese technology, where the risks include “espionage and harmful effects if these things don’t work,” Greenwalt said, there is renewed focus on supply chain security for the active ingredients in drugs and protective gear. Lawmakers are now looking for ways to ensure the US is not dependent on China for either.
Whether it’s a missile guidance component or a vaccine, “the next issue is if you want to surge in this area and you’re dependent on a part from China and can’t surge,” Greenwalt said.
Navarro recently told CNN that in the longer term, especially if Trump wins reelection, the US will likely treat offshore supply chains as national security priorities rather than as simply economic questions. “If we fail to do that in the face of this crisis, we will have failed this country and all future generations of Americans,” Navarro said.
Trump himself has stressed China’s supply chain dominance, saying May 29 that “the pandemic has underscored the crucial importance of building up America’s economic independence, reshoring our critical supply chains.” Secretary of State Mike Pompeo warned US allies again last week to “avoid economic overreliance on China” and “guard their critical infrastructure” from the China’s influence.
‘This is how China operates’
Pentagon officials are now also reaching out to other countries to discuss the risks.
“What I am concerned about is nefarious (merger and acquisition) practices,” Lord told reporters. “We have talked a lot with other nations, particularly in Europe, and we see a lot of shell companies coming in where the beneficial owner ends up being one of our adversaries. I’m particularly concerned about that.”
Dealing with China’s economic pressure will require “multilateral cooperation and work with likeminded democracies,” said Martijn Rasser, a senior fellow at the Center for a New American Security.
He pointed to Europe as a concern, noting reports that China has threatened Germany and Denmark with economic consequences if they do not allow tech firm Huawei — ostensibly a private company — into their markets. Beijing recently slapped 80.5% tariffs on Australian barley exports after Canberra called for an investigation into the pandemic’s origins. When China denied the move was retaliatory, saying that following a two-year inquiry it had confirmed that dumping by Australia had damaged its domestic industry, few took that at face value.
Chad P. Bown, a senior fellow at the Peterson Institute for International Economics, pointed to Australia’s experience with its barley export and said, “this is how China operates and everybody knows it.”
Rasser said China could increase “all these coercive tactics” as economies struggle,” adding that “we don’t want to be in the position where we can be coerced economically by China.”