Mark Wu

After getting enormous pressure from the public, as well as from members of both side of the isle in North Dakota, in the wake of Russia’s invasion of Ukraine, the State Investment Board convened a special meeting Thursday to discuss divesting its Russian holdings. During executive session, the SIB voted unanimously to pursue the divestment strategy. ... News Radio reached out to Harvard Professor Mark Wu on any implications that SB 2291 could have in the process. “The decision at hand concerns divestment, as opposed to investment. While the state law places restrictions on the State Investment Board’s investment decisions, it does not place similar restrictions on its divestment decisions.” Professor Wu continued, “What this means practically is that the state investment board could take geopolitical considerations into account for a divestment decision, but should it then decide to divest, the existing law would place restrictions on what the board can and cannot do in deciding how to re-invest the proceeds of the divestment.” Professor Wu is the Henry L. Stimson Professor at Harvard Law School, where he specializes in international trade and international economic law.

On Tuesday, Danny Diaz, who ran former Florida Gov. Jeb Bush’s ill-fated 2016 presidential campaign, told POLITICO’s Tim Alberta that if there’s an “October surprise” in this election, “it’s something abroad. It’s a foreign policy-oriented development.” We asked the experts: if it’s China-related, what might it look like? A Phase One trade deal collapse is the most likely China-related event to upend the U.S. election. Harvard Law School’s Mark Wu says President Donald Trump could declare China “off track in meeting the purchase commitments.” Eurasia Group’s Paul Triolo says Trump “has become progressively less interested in the trade deal,” while E14 Fund’s Calvin Chin says ditching the deal is the “easiest to pull off [with] good electoral bang for the buck.” The Bay Area Economic Council’s Sean Randolph tells China Watcher that “while this might look like a failure at one level, Trump could try to show that he's in control, tough on China, and looking out for U.S. interests.” The deal would be (bureaucratically) easy to unwind, according to Asia Society’s Wendy Cutler. “Legally, the agreement requires a 60-day advance notification period before withdrawal,” she tells China Watcher, “but as we’ve seen to date the legalities would be overshadowed by a surprise announcement.” Trump can get the electoral pop from an announcement his administration intends to leave, even if it’s not official until after the election. U.S. and Chinese multinational companies could be frozen out. Heritage Foundation’s Klon Kitchen says China could block a TikTok sale and possibly remove “one or several industry leaders” among U.S. tech companies in China. Schmidt Futures’ Christopher Kirchhoff says Chinese ruler Xi Jinping could “move to ban Apple products in China.” Syracuse University’s Mary Lovely says a Trump move against WeChat could see Beijing retaliating against U.S. firms in China.

How far has the diplomatic relationship between the United States and China sunk? It’s gotten to the point where China watchers are increasingly invoking a fuzzy but extreme concept: “decoupling.” In its purest form, the term refers to a halt in the flows of information, money, ideas, and people between the world’s two powers. And there’s plenty of evidence the two countries are headed in that direction...But how realistic is a pure decoupling – and what does decoupling, in any form, mean for our collective future? To help answer this question, I gathered a group of China experts with backgrounds in finance, trade, government and technology...Joining me for the virtual discussion...[is] Mark Wu, Vice Dean and professor of international trade at Harvard Law School... "When we use the term decoupling, we have to think of it as a spectrum. There are a range of options and it will differ depending on which sector. What's the nature of that company? It will also differ based on where that company earns its revenue globally. One possibility is definitely the zero-sum choice that Samm alluded to. But for other companies, this is a question about simply not putting all your eggs in one basket. So you've seen some companies depend overwhelmingly on either Chinese or American suppliers. And now [they are] thinking, we better have other sources in case unexpected developments happen. Then there is another alternative, which is to say nothing's going to change about how we operate currently, but we may have to change our future plans. Chinese companies right now who operate with a 'China for China' type of strategy may now be thinking about going towards a 'China for the world' strategy."

President Trump said he would sign the recently negotiated phase-one trade deal with China in Washington on Jan. 15 — marking a formal truce in the U.S-China trade war — and would later travel to Beijing to negotiate a broader pact...Mr. Trump has focused most of his attention on the Chinese farm purchases. According to U.S. negotiators, China has agreed to buy an average of at least $40 billion annually in agricultural goods starting in 2020...In addition, the U.S. has claimed, China has agreed to increase overall imports of U.S. goods and services by $200 billion over the next two years — a growth spurt that China hasn’t come close to reaching in the years since it joined the World Trade Organization in 2001...Both sides say that any purchases must conform to WTO rules — a requirement that could give China a way to argue that it can’t meet purchase goals. For instance, soybean purchases diverted from Brazil to the U.S. could violate WTO rules. “The trick is for the agreement to be crafted in a manner that’s ambiguous enough so as not to raise WTO challenges, but is clear enough to satisfy the U.S. that the Chinese government will use the tools available to it to direct farm purchases to the U.S.,” said Mark Wu, a WTO expert at Harvard Law School.

Hours after China announced retaliatory tariffs on U.S. goods on Friday, President Donald Trump ordered U.S. companies to “start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.”...Trump could treat China more like Iran and order sanctions, which would involve declaring a national emergency under a 1977 law called the International Emergency Economic Powers Act, or IEEPA...Invoking IEEPA could also trigger legal challenges in U.S. courts, said Mark Wu, a professor of international trade at Harvard Law School...A far more dramatic measure, albeit highly unlikely, would be to invoke the Trading with the Enemy Act, which was passed by Congress during World War One. The law allows the U.S. president to regulate and punish trade with a country with whom the United States is at war. Trump is unlikely to invoke this law because it would sharply escalate tensions with China, said Wu. “It would be a much more dramatic step to declare China to be an enemy power with which the U.S. is at war, given the president has at times touted his friendship with and respect for President Xi (Jinping),” said Wu. “That would amount to an overt declaration, while IEEPA would allow the Trump administration to take similar actions without as large of a diplomatic cost.”