US President Joe Biden's restrictions on hi-tech trade with China came to a head in meetings between the countries' top commerce officials.

In a call with her Chinese counterpart, Wang Wentao, US Secretary of Commerce Gina Raimondo defended these rules put in place on national-security grounds as "not negotiable", her department said on Tuesday.

Raimondo "noted ongoing concerns from the US business community about decreasing regulatory transparency in the PRC, non-market policies and practices, and structural overcapacity in a range of industrial sectors", according to a read-out.

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"Secretary Raimondo reiterated that US national security is not negotiable and re-emphasised that the US government's 'small-yard, high-fence' approach aims to safeguard US national security in as targeted a manner as possible, while leaving space for healthy trade and investment," it added.

The Biden administration has sought to tackle increasing concerns in the US about China's growing military presence in the Indo-Pacific and manufacturing dominance in key industries such as electric vehicles.

The latest measures address fears that Beijing policymakers are leaning more heavily into exports to pull the country out of a domestic economic slowdown that has plagued them since they abandoned strict Covid-19 lockdown measures nearly two years ago.

Last month, the Biden administration announced rules that would ban hardware and software made by Chinese and Russian companies for connected vehicles, the latest in a series of restrictions meant to curb the flow of technology that Washington's policymakers fear could be used to advance Beijing's military power.

Beijing's read-out of Raimondo's call with Wang, a follow-up to a second meeting of the US-China Commercial Issues Working Group - a forum established last year when Biden met with Chinese President Xi Jinping - touted "positive progress in expanding cooperation, managing differences and addressing specific concerns of enterprises".

However, the meeting turned quickly to "serious concerns" about Biden's restrictions.

Wang "focused on expressing serious concerns about the US semiconductor policy towards China and restrictions on China's connected cars", according to the Chinese commerce ministry's read-out.

"It is particularly necessary to clarify the national-security boundaries in the economic and trade fields, which is conducive to maintaining the security and stability of the global industrial chain and supply chain and creating a good policy environment for cooperation between the two countries' industries," it said.

"China urges the US to pay attention to the specific concerns of Chinese companies, lift sanctions on Chinese companies as soon as possible and improve the business environment for Chinese companies in the US," Beijing's read-out added.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

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