U.S. wants to inject $25 billion to pull businesses out of China

According to Reuters, U.S. lawmakers and administration officials are drawing up plans to push U.S. companies to move production lines or critical supply chains out of China with a variety of attractive measures. These include tax breaks, new regulations and carefully calculated subsidies.

Reuters interviewed dozens of current government officials as well as former officials and executives of major industry companies, in addition to lawmakers. Accordingly, there are extensive discussions going on - including the idea of a $25 billion fund to invest in companies that want to reform their relations with China.

President Trump has long pledged to bring manufacturing from abroad to the U.S., but the arrival of the coronavirus and concerns related to dependence on medical and food supply chains are pushing this plan to move faster.

On May 14, Trump signed an executive order that gives the administration's foreign investment agency new powers to help U.S. companies move production out of China. According to the president, the goal of the executive order is for the U.S. to be able to produce everything it needs, and then to export it to the world, including pharmaceuticals.

But officials in the administration are still divided on how best to proceed with this plan, and the problem is unlikely to be solved overnight, nor is it possible for the government to spend more money at this time discuss the next round of fiscal stimulus, as the priority at this time is to revive the domestic economy.

Lawmakers from both parties are drafting legislation aimed at reducing U.S. dependence on products made in China, which accounted for 18 percent of imports into the country in 2019. Medical supply chains and defense-related products are at the top of this list.

One idea being discussed in Washington is to allocate $25 billion to companies that produce essential goods to relocate, ensuring that fish products far from the supply chain also originate from the U.S. according to 2 administration officials interviewed by Reuters.

According to ZING