Over two decades since the People’s Republic of China joined the World Trade Organization, the country has grown into an economic superpower rivaling the United States. The Chinese Communist Party leadership harbors aggressive strategic ambitions of replacing the U.S. as the preeminent power on the world stage and creating an international order subservient to China’s interests. Through industrial espionage, forced technology transfers, and extensive intellectual property theft, China and its network of state-sponsored enterprises have been able to gain a crucial advantage in developing advanced technologies in a variety of industries.
Most concerning, China now controls the production of many essential resources in our supply chains. For example, China dominates the supply of strategic minerals, such as rare earth metals and alloys that are key components in military vehicles, including submarines, fighter jets, and sophisticated radar and missile guidance systems. The coronavirus pandemic revealed to many people the depth of our dependence on China for medicine and medical supplies such as PPE. Seventy percent of U.S. imports of acetaminophen and around half of U.S. penicillin imports come directly from China, and China is the major source of active pharmaceutical ingredients for thousands of drugs sold in the U.S.
This is where my Western Hemisphere Nearshoring Act comes in. My bipartisan bill, authored with Western Hemisphere subcommittee Chairman Albio Sires, a New Jersey Democrat, would help reduce our dependence on Chinese manufacturing, promote manufacturing in Central and South America, and, importantly, address the factors driving illegal immigration from Latin America. The bill creates a low-interest loan program, administered by the International Development Finance Corporation and financed by our existing tariffs on China, to induce companies to move their factories from China to Latin America. Under this nearshoring proposal, companies would get tax benefits such as duty-free trade with the U.S. for 15 years and accelerated depreciation for the relocation of manufacturing assets.
Best of all, this program leverages private investment to help supply financing, with the revenue from the existing Chinese tariffs going to buy down the interest rate. Borrowers would enjoy an ultralow interest rate as a result of the buydown at no expense to U.S. taxpayers.
Returning manufacturing to our hemisphere from China would reduce our supply chain’s dependence on Chinese manufacturing while fostering economic prosperity among our southern neighbors. Reshoring manufacturing to Latin America would go a long way toward addressing the factors driving illegal immigration from these countries. Stable foreign investment and the development of robust industrial sectors would help diversify the economies in this region and raise the standard of living for millions living in poverty.
Lastly, my bill targets illegal immigration from Latin America to the U.S. This crisis has persisted for many years but has surged to record levels. In 2021, U.S. Customs and Border Protection encountered over 2 million migrants at the southern border, and border apprehensions have remained over 150,000 per month for over a year. With the impending end of the Title 42 public health authority to allow the expedited removal of illegal immigrants, the volume of migrant encounters at the border is only expected to surge even higher.
My bill would provide an avenue for the U.S. to counter the CCP’s efforts to extend its predatory influence throughout Central and South America. China and its network of state-owned enterprises are actively seeking to control critical infrastructure and commercial assets in the region, including ports, airports, natural resources, and communications, by means of China’s Belt and Road Initiative. The U.S. must take this opportunity to cultivate closer relations within the Western Hemisphere and foster stronger commercial ties with these nations, for reasons both commercial and strategic. As we develop stronger partnerships in the region, we will be in a better position to safeguard the Western Hemisphere against communist China’s imperialism.
Mark Green, a physician and combat veteran of Afghanistan and Iraq, represents Tennessee’s 7th Congressional District in the House of Representatives. He serves on the House Armed Services and Foreign Affairs committees.
