Pelosi, Schumer Join Cornyn and Casey in Calling for Executive Order on Outbound Investment
WASHINGTON — The Coalition for a Prosperous America (CPA) today applauded a bipartisan, bicameral letter to President Joe Biden requesting the administration take immediate action to safeguard national security and supply chain resiliency on outbound investments to foreign adversaries like China. The letter was signed by U.S. Senators Bob Casey (D-PA), John Cornyn (R-TX) and Chuck Schumer (D-NY), Speaker Nancy Pelosi (D-CA), and Representatives Rosa DeLauro (D-CT), Bill Pascrell (D-NJ), Brian Fitzpatrick (R-PA), and Victoria Spartz (R-IN). Earlier this month, CPA applauded the Biden administration’s Executive Order to address inbound Chinese investment, and called for additional action to address outbound investment risks in critical capabilities investment overseas by U.S. firms and in outbound capital flow.
The lawmakers have also introduced the National Critical Capabilities Defense Act, which would help prevent American supply chains from being offshored by establishing an outbound investment review, which covers production, development, manufacturing, or fabrication of identified critical national capabilities to countries, like China and Russia, that are deemed foreign adversaries.
“As deliberations continue in Congress, we urge your Administration to move forward with executive action— which can then be bolstered by statutory provisions—to safeguard our national security and supply chain resiliency on outbound investments to foreign adversaries,” the members of Congress wrote. “When we cede our manufacturing power and technological know-how to foreign adversaries, we are hurting our economy, our global competitiveness, American workers, industry and national security. Government action on this front is long overdue to address the scope and magnitude of these serious risks we face as a country.”
The bipartisan, independent U.S.-China Economic and Security Review Commission’s 2021 Annual Report to Congress noted that “China has shown willingness to weaponize and politicize supply chains” where “U.S. companies may struggle to avoid critical shortages without domestic…alternatives.” Additionally, the report highlights that “U.S. and foreign investors have poured into China’s capital markets” despite the Chinese government and Communist Party’s strict control over their economy. Among the Commission’s top recommendations is to pass legislation that accomplishes the goals of the National Critical Capabilities Defense Act by creating the “authority to screen the offshoring of critical supply chains and production capabilities to the People’s Republic of China to protect U.S. national and economic security interests.”
“On behalf of CPA and our members, we applaud this bipartisan, bicameral letter calling for increased scrutiny over outbound investment to China,” said Zach Mottl, Chairman of CPA. “It is a welcome development to have Speaker Pelosi and Majority Leader Schumer sign this letter, and we strongly urge them to prioritize the passage of the National Critical Capabilities Defense Act without delay. Additionally, the Biden administration should issue an Executive Order to address outbound investment to China that poses a serious risk to U.S. national and economic security. Currently, U.S. capital is flowing to bad-actor Chinese companies that are complicit in the CCP’s genocide, human rights abuses, military modernization efforts, and economic warfare against American workers and manufacturers. Congress and the Biden administration must prioritize and move forward with action to address U.S. outbound investment.”