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Doing Business with China: Strings Attached

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Published April 27, 2022

US businesses and politicians must accept that the Chinese Communist Party is pressuring them to sacrifice American values in order to do business in China. In response, they should find ways to increase America’s leverage over Beijing, including diversifying supply chains to mitigate the risks of a belligerent China. Ultimately, while Beijing tries to impose its authoritarian values on the world, free societies will continue to harness the human spirit.

Discussion Questions:

  1. How will diversifying supply chains mitigate the risks of a belligerent China?
  2. How does China pressure US businesses to sacrifice their American values?

Additional Resources:

  • Read “Beijing Targets American Businesses,” by Matt Pottinger via the Wall Street Journal. Available here.
  • Read “Red Lines,” by Matt Pottinger via the Hoover Digest. Available here.
  • Watch or read Matt Pottinger’s testimony before the US Senate Select Committee on Intelligence, “Beijing’s Long Arm: Threats to US National Security.” Available here.
View Transcript

The Chinese Communist Party has made clear that American businesses must be willing to sacrifice their American values in order to do business in China.

China’s top diplomat has even publicly stated that trade opportunities and other profitable investments are dependent on American businesses remaining silent on issues like the independence of Tibet or Taiwan, the genocide of Uighur Muslims in Xinjiang, and the crackdown on democracy in Hong Kong.

So what should American businesses and politicians do?

They must accept that the situation has changed over the past few years. While previously businesses could avoid picking sides, mounting issues between our two nations mean it will be increasingly difficult to please both Washington and Beijing.

These increased tensions should give corporations second thoughts about concentrating their operations in an autocratically ruled country. Diversifying their supply chains will thus be key to mitigating the risks of a belligerent China.

America and its allies must always consider whether our actions increase our leverage over a hostile dictatorship in Beijing. The western world still maintains considerable leverage over China, and it must remain that way.

We should remember that Beijing is trying to engineer victory from the mind of a single leader, while free societies like ours continue to harness the human spirit.