Trump Weighing Sanctions On Chinese Officials, Seizure And Freezing Of Chinese Assets

In a move that would sharply antagonize the already frayed relations between the US and China, president Trump is reportedly considering sanctions against Chinese senior officials and companies to punish Beijing’s detention of hundreds of thousands of ethnic Uighurs and other minority Muslims in what we reported recently were "massive internment camps", the NYT reported citing current and former American officials.

While Trump has engaged in extensive punitive measures against China over the country's "unfair" trade surplus with the US involving various rounds of tariffs - to which China has responded in tit-for-ta measure - the contemplated economic penalties would be one of the first times the Trump administration has taken action against China because of human rights violations, a topic which Beijing has been acutely sensitive about and could prompt a far more "emotional" response by Beijing. Additionally, US officials are also seeking to limit American sales of surveillance technology that Chinese security agencies and companies are using to monitor Uighurs throughout northwest China.

According to the report, while discussions to publicly rebuke China’s treatment of its minority Muslims had been underway for months among top government officials, the they gained urgency two weeks ago, "after members of Congress asked Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin to impose sanctions on seven Chinese officials."

And as noted above...

Until now, President Trump largely has resisted punishing China for its human rights record, or even accusing it of widespread violations. If approved, the penalties would fuel an already bitter standoff with Beijing over trade and pressure on North Korea’s nuclear program.

Human rights advocates say the mass detentions in the northwest region of Xinjiang are the worst collective human rights abuse in China in decades. It is also a part of President Xi Jinping's governing style: since taking power in 2012, Xi - who recently changed the constitution to declare himself president for life - has steered China on a hard authoritarian course, which includes increased repression of large ethnic groups in western China, notably the Uighurs and Tibetans.

On Sunday, Human Rights Watch released a detailed report that concluded the violations were of a “scope and scale not seen in China since the 1966-1976 Cultural Revolution.” The report, which was based on interviews with 58 former residents of Xinjiang, recommended that other nations impose targeted sanctions on Chinese officials, withhold visas and control exports of technology that could be used for abuses.

In a process that would make members of the liberal US media faint, the Chinese Muslims in the camps are forced to attend daily classes and denounce aspects of Islam, study mainstream Chinese culture and pledge loyalty to the Chinese Communist Party. Some detainees who have been released have described torture by security officers. Chinese officials have labeled the process “transformation through education” or “counter-extremism education.” But they have not acknowledged that large groups of Muslims are being detained.

What is bizarre about the planned sanctions is that Trump has rarely if ever made statements criticizing foreign governments for human rights abuses or anti-liberal policies, and in fact has praised authoritarian leaders, including Xi. The Trump administration has confronted China over economic issues — the two countries are in the middle of a prolonged trade war — but has said little about rampant abuses by its security forces.

As such any escalation in the human rights arena, where China believes no foreign nations has any right to meddle over fears it could embolden other social groups to oppose and protest Beijing, would result in a significant deterioration in already frayed relations between the two nations.

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Separately, in a report from Bloomberg over the weekend which was largely lost in all the noise over Trump's proposed $267BN in new tariffs on Chinese imports, the US president is also reportedly considering imposing sanctions on Chinese entities caught stealing U.S. intellectual property via cyber attacks.

The plan being discussed would use an Obama administration executive order that allows the U.S. to impose sanctions on individuals or entities engaging in “malicious cyber-enabled activities.” But it has sparked a heated debate among administration officials, with Treasury Secretary Steven Mnuchin, who has jurisdiction over the potential sanctions, said to be blocking the effort, the people said.

Mnuchin has reason to be concerned: if Trump proceeds with the plan, the US could seize or freeze the assets of Chinese companies caught stealing U.S. firms’ intellectual property. It could also ban them from doing business with American companies.

The ongoing internal debates over new Chinese sanctions highlight how the Trump administration has been looking at raising the pressure on Beijing via measures beyond tariffs, all of which are part of what officials see as "an existential innovation war with China."

Meanwhile, Trump is preparing to proceed with new tariffs on some 6,000 products from China that account for $200 billion in annual trade and which would be imposed “soon.” On Friday, the president also threatened to hit a further $267 billion in imports from China with tariffs “on short notice,” adding to $50 billion already in place. Together, they would exceed the value of all imported Chinese goods last year, worth $505 billion.

Should one or both of these proposals move beyond the planning stage, China's response would be stark and all those wondering when US assets will finally respond to the ongoing conflict between the two superpowers will get an answer.

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