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Trump Administration Turns Up Pressure on China on Several Fronts - The Wall Street Journal

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President Trump has wavered between pursuing pressure tactics toward China and trying to shepherd a trade deal reached in January.

Photo: Anna Moneymaker/Zuma Press

WASHINGTON—The Trump administration is intensifying U.S. pressure on China, piling on visa bans, sanctions and other restrictions that are battering already unsettled ties between the world’s two largest economies.

Attorney General William Barr, in a speech Thursday, warned U.S. businesses that they are at risk of collaborating with a Chinese government that ultimately seeks to supplant them in its expanding state-run economy. Administration officials are also discussing banning travel by China’s Communist Party members and their families to the U.S., people familiar with the matter said.

Discussions are in early stages, with no timeline for being put into effect, the people said. If put into policy, advisers and policy analysts said the ban would strike at the legitimacy of the increasingly powerful party.

The administration has amped up a broader confrontation with Beijing in recent weeks by imposing sanctions on a member of the Communist Party leadership, signing legislation that targets other Chinese officials and holding full-scale military exercises in the South China Sea.

All this has come after President Trump for months has blamed China for covering up the initial coronavirus outbreak that his administration has struggled to contain in the U.S.

Hawkish policies from both governments over trade, technology and global influence have pitched relations downward for the past two years. The U.S. is largely steering the latest downturn, seeing gains in pressuring on Beijing, according to current and former officials and policy analysts.

Mr. Trump’s political advisers said that displaying toughness on China resonates with voters ahead of the November election and that portraying his presumptive Democratic rival, Joe Biden, as weak on China is a potent campaign pitch.

“No administration has been tougher on China than this administration,” Mr. Trump said during remarks in the White House’s Rose Garden on Tuesday. In his lengthy, wide-ranging comments, he mentioned Mr. Biden more than 25 times while repeatedly returning to China and his administration’s efforts to thwart it.

Mr. Biden also has toughened his approach to China and said his decades of dealing with Beijing make him better suited than Mr. Trump to navigate the current turbulence.

China has added to the recent run-up in tensions. It imposed a harsh national security law on Hong Kong, the Chinese territory that is a global financial center and hub for U.S. businesses. Chinese diplomats have also gone on a rhetorical offensive, casting the U.S. as bullying and out of control, and suggesting that the U.S. is to blame for the coronavirus.

Even so, Beijing has become concerned about the deteriorating ties with its major trading partner, especially at a time when the Chinese economy—while showing signs of recovering from the slowdown induced by the coronavirus—isn’t back to full strength.

In a speech last week, Chinese Foreign Minister Wang Yi said that the U.S.-China relationship faces its “most severe challenge since the establishment of diplomatic ties.” He said China had no intention of replacing or having a full-scale confrontation with the U.S. and urged Washington to resume contacts and restore stability to ties.

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President Trump signed a sanctions bill targeting Chinese officials and said he would end special treatment for Hong Kong. WSJ’s Andrew Dowell looks at how tensions over a national security law recently imposed by Beijing are changing the financial hub. Photo Composite: George Downs

“Only communication can dispel falsehoods. Only dialogue can prevent miscalculation,” Mr. Wang said. “Slandering others does not clear one’s own name, and finger-pointing cannot resolve any problems.”

Some Trump administration officials said the president is more cautious than he lets on and that he’s trying to balance applying pressure on Beijing to further U.S. interests without blowing up the relationship.

China hawks in the administration are urging him to take more drastic steps, including sanctions on a larger number of Chinese officials. Mr. Trump has so far resisted those calls, one of the officials said. One reason is that some in the administration don’t want to undermine a trade deal reached in January that requires China to ramp up purchases of American farm products and other goods this year.

The points of contention with China have become so numerous that some business executives and policy analysts say that the global economic order is fracturing and that a mutual suspicion reminiscent of the Cold War is exacerbating the disagreements.

“We’re kind of in a downward spiral where we’ve cut off things from China, they’ve cut off things from us,” said Robert Zoellick, former World Bank president and deputy secretary of state under George W. Bush and now a senior counselor at the Brunswick Group, a consulting firm.

“The degree of hostility is spiraling out of control,” Mr. Zoellick said Thursday at the Aspen Security Forum, a nonpartisan conference series on national security. “We kind of have to steady ourselves.”

Many U.S. businesses, which once were among Beijing’s biggest supporters in Washington, have been buffeted by the tariffs and restrictions on technology both governments have imposed and see the deteriorating relations as a further risk.

Four U.S. government departments issued a warning this month that American firms could face reputational or sanctions-violation risks for partnerships or customers tied to China’s Xinjiang region, where Beijing has detained hundred of thousands of mainly Muslim ethnic groups in a network of camps.

Attorney General Barr, in his speech Thursday, called out the Hollywood entertainment industry as well as major tech companies like Apple Inc., saying they are “all too willing to collaborate” with Beijing.

“The ultimate ambition of China’s rulers isn’t to trade with the United States. It is to raid the United States,” Mr. Barr said. He added: “If you are an American business leader, appeasing the PRC may bring short-term rewards. But in the end, the PRC’s goal is to replace you,” referring to the People’s Republic of China.

A spokesman for Apple referred to previous statements in which the company said remaining engaged is the best way to promote openness “even where we may disagree with a country’s laws.”

Mr. Barr is the most recent of several senior administration officials to devote a public speech to what the administration sees as the challenges posed by China.

Last week, the director of the Federal Bureau of Investigation, Christopher Wray, called the scale of China’s theft of intellectual property “so massive that it represents one of the largest transfers of wealth in human history.” He said the FBI opens a new China-related counterintelligence case every 10 hours, with nearly 2,500 such cases under way.

So far, many of the Trump administration’s China announcements are more about words than specific binding actions. The administration has yet to sanction senior Chinese officials over Beijing’s security law in Hong Kong, although they are being considered, a senior administration official said.

Still, the administration’s rhetoric on China is almost uniformly hard-line.

“Words are very powerful,” Assistant Secretary of State David Stilwell said this week in a discussion about a new administration policy that formally opposes China’s expansive claims to the South China Sea.

Write to Andrew Restuccia at Andrew.Restuccia@wsj.com and William Mauldin at william.mauldin@wsj.com

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