Harris to Tackle Supply Crunches in Trip to China’s Doorstep

(Bloomberg) -- The global semiconductor shortage and other supply chain troubles will be a focus of Vice President Kamala Harris’s trip to Southeast Asia later this month, where she also aims to shore up U.S. relations with countries at China’s doorstep.

Harris’s team plans to field questions from U.S. business and labor leaders before she travels to Singapore and Vietnam, a senior administration official said. The Biden-Harris administration pledged to give unions a voice in U.S. trade policy, a move that has drawn criticism from members of the business community.

Harris is scheduled to meet with political leadership as well as business and civil society groups in both countries. She seeks expanded trade relationships, the official said, but it’s not clear if she’ll return with specific economic outcomes.

The White House is debating the possibility of a free-trade agreement that covers digital issues with countries in the Indo-Pacific region, which includes the two nations Harris will visit. She will be the first vice president to visit Vietnam.

She’s scheduled to arrive in Singapore on Aug. 22, before heading to Vietnam for two days on Aug. 24.

Supply chain security and resilience will be a major focus of the trip, and finding solutions to avoid shortages is a priority for Harris, the official said. Vietnam in particular plays an increasingly important role in many supply chains, as companies in recent years moved operations there from China. The pandemic has forced factory shutdowns in Vietnam, where less than 1% of its population is fully vaccinated, according to data compiled by Bloomberg.

A global semiconductor shortage continues to cause production delays for the auto and consumer electronics industries. The Biden White House has for months engaged with industries and lawmakers on ways to alleviate the crisis, without much effect so far.

Singapore has sought to increase its chip-making talent and manufacturing capability. U.S.-based GlobalFoundries Inc. recently said it planned to build a $4 billion plant in the city-state, slated to start in 2023, and the facility is expected to primarily serve smartphone and auto demand.

Southeast Asia is consequential for the U.S., the official said, as the fastest-growing region in the world with enormous economic and strategic value. While China will be a topic during the meetings, Harris and her team will put greater emphasis on the positive agenda they share with the countries, the official said.

Harris will also address disagreements the U.S. has with the countries, the official said, without elaborating.

Covid-19 restrictions in both countries, far stricter than in the U.S., may limit soft touches that endeared other American leaders to the public.

Joe Biden, on his own vice presidential trip to Singapore in 2013, paid a surprise visit to a local hawker center for lime juice, while the Hanoi eatery where Barack Obama and Anthony Bourdain ate bun cha later encased their table and place settings in glass to preserve it for all time.

The Biden administration has been accused of neglecting U.S. allies and partners in the region. Economic ties between countries like Singapore, Vietnam and Indonesia have recently shifted in China’s favor, James Crabtree, the executive director of the International Institute for Strategic Studies-Asia, recently wrote in an op-ed for Foreign Policy that said Biden risks losing Southeast Asia to Beijing’s influence.

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