Research & Analysis

Beijing has taken the first step toward fixing its economic problem—admitting it has one. China’s growth has continued to stagnate this year as it grapples with a protracted real estate downturn, local government debt, and record youth unemployment, which have all resulted in an acute crisis of confidence.

The Department of Commerce on Thursday issued a notice of proposed rulemaking that would prohibit the import or sale in the United States of connected vehicles (CVs) with certain software or hardware designed, manufactured, or developed in China. With most newly modeled cars incorporating some internet-connected system, this rule would effectively ban all Chinese cars from entering the US market.

Accessing China’s vast public procurement market continues to be difficult for US companies. Procurement issues appeared in this year’s list of top 10 challenges for USCBC members for only the third time in our survey’s history.

Six months after China’s internet regulator published new rules on data flows, cross-border data transfer (CBDT) remains a top challenge for US companies operating in the country. Sector-specific issues and the introduction of free-trade zone CBDT rules are presenting new challenges to companies even as national-level compliance burdens have eased.

The impending presidential and congressional transition in the United States is prompting American policymakers to push for final approval on long-debated tariff policies, in part in an effort to win voters. The initiatives in question—the final Section 301 determination, new de minimis rule, and ongoing debate over China’s trade status with the United States—are all in different stages but stem from similar motives.

The Biden administration’s announcement of a new rulemaking process to limit the ability of Chinese products under $800 to enter the United States duty-free under the de minimis provision has breathed new life into congressional deliberations on the issue.

US-China trade continued to decline in the first half of 2024, reaching 2.3 percent year-over-year after both US exports to and imports from China contracted. That said, this is the slowest contraction in overall US-China trade since the second half of 2022.

The Biden administration announced today that it would be taking new actions to limit use of the de minimis provision, a trade rule that allows shipments under $800 to enter the United States tariff-free.

China is hoping to replicate Silicon Valley-style innovation through its policy support for small- and medium-sized enterprises (SMEs). Several initiatives released this past summer by government ministries provide investment incentives and low-cost financing for qualified domestic companies that innovate new technologies.

On August 29, Jake Sullivan concluded his first trip to China as national security advisor, where he met with several senior Chinese officials as part of ongoing efforts to maintain open lines of communication between Washington and Beijing.