Analysts say China is “trying to shape” the American chemical industry in a way that would benefit its national security interests, while American chemical manufacturers are pushing back against Chinese efforts to restrict foreign competition.
The US chemical industries face challenges from China, which has a large market share of U.S. chemical products, and the rise of China-backed energy companies in the developing world, analysts say.
The chemical industry is an economic powerhouse with more than $100 trillion in annual sales, and China has been an important ally in Washington’s effort to contain the growing threat from terrorism and other threats, said David O’Sullivan, president of the New America Foundation.
In 2017, the US imported $4.2 trillion worth of chemicals, with an annual $3.6 trillion value.
Analysts said the Trump administration was focusing on chemical industries because the industry has been critical to US security.
“They are taking away U.s. chemical supply chains, including our ability to export the stuff, and they are basically making it more expensive to manufacture stuff,” said Steven Shafer, director of the Center for International Policy at the Council on Foreign Relations.
Shafer said the US industry could also face competition from China-supported companies in countries that lack a market for American products.
The National Science Foundation estimates that the US imports $4 trillion worth in chemicals each year, and many of those chemicals are used in other countries.
Shader, the Chinese chemical industry consultant, said China was trying to shape the chemical industry to benefit its security interests.
“The fact is, this is going to be an important industry for the future of the U.K., the United States, Europe, Australia, and other countries in Asia and around the world,” Shader said.
China is “taking control of this,” he added.
“They’re trying to mold the American industry into a better state.”