Instead of relying on tariffs, the U.S. should partner with its allies to restrict Chinese investment in certain sectors, until those same sectors are opened up to Western investment in China, the former U.S. ambassador to China said.
The fact that Chinese investments worldwide are increasing gives the U.S. some leverage, according to Gary Locke, who was then-President Barack Obama's top diplomat in Beijing for more than two years. The U.S., he told CNBC, can push for access to Beijing's market by threatening to close the global investment opportunities China now enjoys.
"I really believe the United States has to partner with our allies and other countries that have similar grievances toward China and basically say Chinese can't invest in sectors of the U.S. economy or foreign economy unless those same sectors are open to foreign investment by Americans or the EU countries or other Western countries," Locke said.
Washington has legitimate concerns and grievances against China's trade policy, which includes the theft of American companies' intellectual property, the requirement of joint ventures for American companies looking to do business there, as well as many sectors of the Chinese economy being off-limits to foreign investment, Locke explained.