US House finalises bill to confront China, including provisions on semiconductors and Taiwan ties

  • The America Competes Act of 2022, which runs to nearly 3,000 pages, was made public on Tuesday evening
  • The bill calls for moves that would infuriate Beijing, such as changing the name of Taiwan’s de facto embassy in Washington

The US House of Representatives on Tuesday finalised sweeping legislation meant to boost US competition with China.

The 2,912-page bill, called the America Competes Act of 2022, includes billions of dollars for the US semiconductor industry; new provisions to strengthen US relations with Taiwan and the “Quad”, an alliance comprising the US, Japan, India and Australia; and US$100 million to counter Chinese government censorship and disinformation.

It would create a new US special envoy position at the US State Department to coordinate a response to “the gross violations of universally recognised human rights occurring in” China’s far-west Xinjiang region. The Uyghur Human Rights Policy Act would be amended to sanction officials for “systematic rape, coercive abortion, forced sterilization, or involuntary contraceptive implantation policies and practices”.

Nancy Pelosi: “Today, the House takes action to transport our nation into the future, with the #AmericaCOMPETES Act: bold, results-oriented legislation that will strengthen America’s national and economic security and the financial security of families, and advance our leadership in the world.”

And the bill would give those fleeing Xinjiang “Priority 2” refugee status, designating them as refugees of special humanitarian concern and allowing them to apply for asylum from either within China or a third country.

That provision also directs the US secretary of state to prioritise bilateral relations with other countries that host former Xinjiang residents are subject to “significant diplomatic pressures” from Beijing.

The bill also directs America’s secretary of state to move toward changing the name of Taiwan’s de facto embassy in Washington, the Taipei Economic and Cultural Representative Office, to the “Taiwan Representative Office in the United States” – a move certain to infuriate Beijing, which views the self-governed island as its own territory.

The name change would be “reflective of the substantively deepening ties between Taiwan and the United States,” the bill says.

US President Joe Biden, who has cast competition between the US and China as a battle to win in the 21st century, applauded the House package, which he said would fortify US supply chains and “reinvigorate the innovation engine of our economy to outcompete China and the rest of the world for decades to come”.

Biden said in an official White House announcement that the proposals within the America Competes Act would help bring back manufacturing jobs to the US, ease supply chain bottlenecks within the semiconductor industry, and help tackle the climate crisis.

“Together, we have an opportunity to show China and the rest of the world that the 21st century will be the American century – forged by the ingenuity and hard work of our innovators, workers, and businesses,” Biden said.

The legislation would grant refugee status to some Hongkongers fleeing the city in response to a new National Security Law that opposition politicians and critics warn can be used to suppress dissent in the city.

It also extends the US ban on exporting munitions to the Hong Kong police force, until “the Hong Kong Police have not engaged in gross violations of human rights” for one year, among other criteria.

On the South China Sea, the bill reiterates the US position that China’s claims in the body of water are unlawful.

And it would authorize $10 million to fund language learning centers that would replace China’s controversial Confucius Institutes, which came under scrutiny in the US in recent years because of their ties to the Chinese government.

The program – named after the late Nobel peace laureate Liu Xiaobo, who was imprisoned by China until shortly before his death – would support Mandarin, Cantonese, Tibetan, Uyghur, Mongolian “and other contemporary spoken languages of China”.

The mammoth bill’s text was made public on Tuesday evening, and most lawmakers and their staffs had not yet had a chance to study its details.

The new House bill comes more than seven months after the Senate passed its own bipartisan China legislation, a US$250 billion measure called the US Innovation and Competition Act that focuses on US semiconductor manufacturing and strengthening the US relationship with Taiwan.

It also comes on the same day that the Commerce Department warned of an “urgent” need to pass legislation that would fund the US semiconductor industry amid a global chip shortage.

“The semiconductor supply chain remains fragile, and it is essential that Congress pass chips funding as soon as possible,” said Secretary of Commerce Gina Raimondo earlier on Tuesday.

While the Senate passed its own comprehensive China bill in June with broad bipartisan support, it is unclear if both parties will support the bill in the House.

The US competition with China is a rare issue with widespread bipartisan support in both chambers of Congress, and various House committees had already passed their own China bills that touched on many of the subjects covered in the new America Competes Act, from science research funding to relations with Taiwan.

Only one of those bills, the Eagle Act, had passed its committee without bipartisan support, after House Republicans said at the time that it was not strong enough, and that it should have omitted provisions to tackle climate change – a polarising issue in the US Congress.

US Secretary of Commerce Gina Raimondo says ‘it is essential that Congress pass chips funding as soon as possible’.

 

In a statement on Twitter, House Speaker Nancy Pelosi said that “major components of this package have already passed the House with overwhelmingly bipartisan votes”.

“The #AmericaCOMPETES Act reflects a whole-of-House effort to produce a historic bill that will be most effective at strengthening our competitiveness at home and abroad,” she said.

But Representative Michael McCaul, the top Republican on the House Foreign Affairs Committee, warned on Tuesday that if the new bill was as “partisan” as the Eagle Act, it would not necessarily become law.

“I would strongly urge Speaker Pelosi and other House Democrats to work with Republicans on a bill that will actually counter [Chinese Communist Party] aggression and that has the ability to pass both Houses of Congress,” he said. “These futile messaging bills are pointless.”

Authors: Jacob Fromer, Owen Churchill, SCMP

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