IRMO Brief 04/2023 - US Economic National Security: Divesting China from America’s Capital Markets

There is growing bipartisan agreement amongst US policymakers that Washington’s decadeslong approach to Sino-American relations is unsustainable, as both the United States and China stake claims to their respective visions of economic, technology, and security leadership in an increasingly bi-polar world.

Althoughthe US and China have both pursued economic interdependence since Washington granted Beijing Permanent Normalized Trade Relations (PNTR) in October 2000, recent flashpoints - ranging from growing Taiwan Strait tensions, investigations into Covid-19’origin, reports of Chinese companies supplying Russia’s military, and human rights abuses in Xinjiang - make accelerated decoupling a likelihood. China’s economy slowed in 2022 due to the Chinese Communist Party’s (CCP) ercantilist communist economic model and its draconian “zero-COVID policy”, which exacerbated global supply chain delays and inflationary shocks.