White House quiet as China ramps up trade leverage before Trump-Xi summit

Beijing rolled out new trade rules this month that have alarmed U.S. businesses and which analysts say could seriously undercut American efforts to reduce supply chain dependence on China, Reuters reported.

But the Trump administration's reaction has been uncharacteristically muted - U.S. officials have so far not spoken publicly about Beijing's move.

The rules, announced just weeks ahead of President Donald Trump's May ​14-15 summit with Chinese leader Xi Jinping, lay the legal groundwork for punishing foreign companies that seek to shift their sourcing away from China.

The Trump administration has ‌urged businesses to "derisk" - to be less dependent on goods from China - and retake "sovereignty" in strategic industries, including critical minerals and medicines. Beijing's new rules effectively push U.S. and other foreign businesses in the other direction.

One U.S. official told Reuters on condition of anonymity that the timing of Beijing's announcement, ahead of Trump's China trip, suggested Beijing was testing how eager the White House is to maintain the pause in the trade war, which started early ​last year with a U.S. tariff broadside and Chinese retaliatory levies.

"It's a clear attempt to stop derisking," the official said.

Business groups have sounded the alarm about the Chinese regulations. ​The American Chamber of Commerce in China told Reuters China could cut purchases from foreign firms with little consequence, while foreign companies could face investigation ⁠by Chinese authorities for reducing their dependence.

"Washington's response so far has been silence. That risks signaling weakness," said Craig Singleton, a China expert at the Foundation for Defense of Democracies (FDD) think tank.

With ​the summit approaching, the administration appeared to want to avoid escalating publicly, he added.

White House spokesman Kush Desai did not respond directly to Reuters' questions on the measures, stating only that the Trump ​administration "will continue to leverage every bit of America's economic might to safeguard our national and economic security."

The Treasury Department and the Office of the U.S. Trade Representative did not respond to Reuters' request for comment.