White House officials confirmed the news on the President Donald Trumphas the power to force US companies to move their operations out of China, but no official order yet been made by the US government.The report says.
U.S. companies invested a total of $256 billion in China between 1990 and 2017, compared with $140 billion Chinese companies have invested in the United States, according to estimates by the Rhodium Group research institute. Under the Emergency Economic Powers Act, the US president has the power to regulate the commerce of US companies if a national emergency is declared against an "unusual and extraordinary threat". This would trigger a special authority for the president to regulate "any transactions in foreign exchange" by Americans.
Some U.S. companies had been shifting operations out of China even before the tit-for-tat tariff trade war began more than a year ago. But winding down operations and shifting production out of China completely would take time.
Trump does have some powerful tools that would not require approval from U.S. Congress: Trump could do more of what he’s already doing, that is hiking tariffs to squeeze company profits enough for them to make it no longer worth their while to operate out of China.
In addition of making the products more expensive to buy components from Chinese suppliers, tariff hikes punish U.S. firms that manufacture goods through joint ventures in China.
Trump used a similar strategy earlier this year when he said illegal immigration was an emergency and threatened to put tariffs on all Mexican imports.
