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  February 5th, 2018 | Written by

Increased Economic Threats from China

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  • “Competitors such as China steal US intellectual property valued at hundreds of billions of dollars.”
  • IT theft threatens to erode US competitive advantage.
  • Foreign competitors unfairly tap into US innovation and rob the US of its technological edge.

On December 18, 2017, President Donald Trump unveiled his Administration’s first National Security Strategy (NSS), laying out the White House’s strategic vision for handling pressing challenges in US national security. Overall, the strategy document is outlined in four main pillars: protecting the homeland, promoting American prosperity, preserving peace through strength, and advancing American influence.

The NSS also includes a section devoted to the United States’ strategy in the Indo-Pacific, and warns against China’s use of “economic inducements and penalties, influence operations, and implied military threats to persuade other states to heed its political and security agenda.” The document lays out several economic threats presented by China, the most notable of which include:

Theft of intellectual property: The NSS cites that each year, “competitors such as China steal US intellectual property valued at hundreds of billions of dollars.” The report goes on to warn that this theft has robbed the United States of its technological edge as China and other foreign competitors unfairly tap into US innovation and threaten to erode US long-term competitive advantage in key industries.

Increased foreign investment: The document names China and Russia as countries that use their foreign investments not for economic purposes, but rather to “expand influence and gain competitive advantages against the United States.” Partially in response to these Chinese investment efforts, the strategy states that the United States will pursue freer, fairer, and more reciprocal economic relationships. The administration also promises to “work with the Congress to strengthen the Committee on Foreign Investment in the United States (CFIUS) to ensure it addresses current and future national security risks,” while “maintaining an investor-friendly climate.”

Influence operations abroad: The NSS outlines the threats posed by competitors who “weaponized information to attack the values and institutions that underpin free societies … [and] exploit marketing techniques to target individuals based upon their activities, interests, opinions, and values.” China is specifically cited for its use of data and artificial intelligence to influence the behaviors of its citizens. The document calls for the US private sector to support and amplify voices of tolerance, openness, and freedom around the world.

Increasing presence abroad: The document cites the Chinese government’s efforts to expand its influence in Africa, Latin America, and Asia, where it seeks to undermine development efforts, support corrupt and authoritarian governments, and promote unfair trade systems. In response, the strategy calls for the United States to help foreign governments become more integrated in the world economy, improve political stability, and reduce vulnerability to extremists.