TAIPEI (Taiwan News) — A high-profile Chinese scholar has told media that cutting off the U.S.' access to essential pharmaceutical ingredients from China could be considered if the Trump administration plays a "nasty trick" in the trade talks.
Li touted the idea at a press event on Wednesday (Aug 26), stating that over 90 percent of the essential ingredients used by U.S. pharmaceutical companies come from China. American and Indian pharmaceuticals rely heavily on Chinese-made ingredients, especially for antibiotics and medications for diabetes, HIV/AIDS, and pain.
A Wall Street Journal report recently claimed the Trump administration has approved a giant loan to help drugmakers overcome their dependence on essential pharmaceutical ingredients from China, India, and other countries. Trump has expanded sanctions on China's Huawei and affiliated tech companies to keep them from obtaining critical U.S. technologies.
David Daokui Li (李稻葵), economist and director of the Center for China in the World Economy at Tsinghua University's School of Economics and Management, remarked on the sanctions at Wednesday's event. He expressed concerns that the Trump administration would expand sanctions by blocking the supply of chips to China and hurting its economy.
"If the U.S. dares to play this dirty trick, we can certainly take retaliatory action," he said.
Li proceeded to say that if China's chip supply is cut off, "China can fight back in terms of medical and drug supplies," noting that American pharmaceuticals procure over 90 percent of their essential ingredients from China. He added that these companies could not become self-sufficient in the short term.
Li also warned the U.S. might suspend access to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) system and that the Chinese government needs to prepare for this scenario.
