In the event that bilateral ftas remain the focus for

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In the event that bilateral FTAs remain the focus for the time being, the U.S. should aim to conclude agreements with its strategic allies in the Asia-Pacific region and beyond. Unilateral U.S. action How the U.S. fares in its competition with China will ultimately be determined by actions that the U.S. takes at home. Apart from focusing on its own competitiveness through domestic policies, which are beyond the scope of this policy brief, the U.S. should thoughtfully control access to U.S. technologies through foreign investment and export controls, and effectively use WTO-consistent tariff policies to minimize the harm from Chinese economic practices on U.S. businesses. The U.S. has already made progress domestically on addressing technology transfer issues with the enactment of the Foreign Investment Risk Review Modernization Act (FIRRMA), which included the Export Control Reform Act (ECRA) of 2018. While companies now largely decide which technologies to transfer overseas, the careful implementation of FIRRMA/ECRA is critical to making this a matter for U.S. policy and for considering the national security costs that may not be properly included in private sector decisions regarding the transfer of technology to China. 11 FIRRMA/ECRA also recognizes the importance of working with allies to strengthen multilateral export control regimes and to prevent diversion through U.S. allies in attempts to avoid FIRRMA 10 Petri, Peter A., Michael G. Plummer and Fan Zhai, “The TPP, China and the FTAAP: The Case for Convergence.” In: Tang, Guoqiang and Peter A. Petri, eds. New Directions in Asia-Pacific Economic Integration. Honolulu: East-West Center, 2014. 11 Gros, Daniel. “The Myth of China’s Forced Technology Transfer.” Project Syndicate, November 2018. - forced-technology-transfer-china-by-daniel-gros-2018-11.
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The US-China economic relationship: A comprehensive approach 6 review. 12 The U.S. will need to convince other governments to adopt similar investment and technology export restrictions in order for these U.S. reforms to be most effective. U.S. restric- tions on access to U.S. technology will be less effective and hurt U.S. competitiveness if similar technology is available from the EU or Japan. 13 Making progress on China’s compliance with its WTO commitments will be most effective where the U.S. is also complying with its WTO commitments. This would require the U.S. to calibrate its unilateral use of tariffs, which have undermined the WTO. Instead, the U.S. should expand its use of trade remedy measures—anti-dumping and countervailing duties—that are consistent with U.S. WTO obligations and provide recourse to U.S. business for China’s unfair trade practices. 12 The Export Control Reform Act of 2018 (ECRA) Section 1758.
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