South China Morning Post Quotes Clete Willems on U.S.-China Trade Concerns

Akin Gump public law and policy partner Clete Willems spoke recently with the South China Morning Post for two separate stories on trade relations with China.

The first article, “China’s social credit system for business creates new and complex headaches for EU trade officials,” addressed what the publication describes as “a major sticking point” in bilateral trade negotiations between China and the European Commission—China’s corporate social credit system, which the SCMP describes as a scorecard for businesses. Of particular concern, the article reports, is the potential for the system to be used to penalize foreign companies or their employees who have spoken out on certain topics in China, such as the protests in Hong Kong or the persecution of Uygurs in Xinjiang.

Willems, a former deputy director of the National Economic Council in the Trump administration, said he doesn’t think the social credit system will be raised in the current U.S.-China trade talks, but it is “something that the U.S. and China and the international community are going to have to confront” over the longer term.

Willems added that there is a growing concern in the United States “with China’s social credit rating for corporations, that U.S. companies are really going to have to toe the party line if they want to do business in China. And that’s a big problem.”

The article “Chinese exporters start to take trade war hit – but US consumers also hurting, UN study shows,” looks at the impact of U.S. tariffs on Chinese goods. A new study by the United Nations found that, while Chinese companies have started to absorb many of the costs, U.S. consumers are also being hurt.

According to Willems, the White House is aware that U.S. tariffs planned for December 15 would cause more harm to American consumers than previous duties because they target the sort of consumer goods that U.S. officials previously protected for fear of hitting voters too hard. They include iPhones, laptop computers and gaming consoles.