China’s Xi Wants to Diversify Supply Chains Amid U.S. Curbs

China’s Xi Wants to Diversify Supply Chains Amid U.S. Curbs

Chinese President Xi Jinping called for setting up independent and controllable supply chains to ensure industrial and national security, just as the U.S. moves to cut China off from key exports.

“We must strive to to have at least one alternative source for key products and supply channels, to create a necessary industrial backup system,” Xi said in an April speech on the nation’s economic development that was only published Saturday by the Qiushi Journal, a publication of the ruling Communist Party. The magazine didn’t say why it had waited to release the remarks.

Xi said the impact of the coronavirus epidemic exposed hidden risks in China’s industrial and supply chains, without elaborating, thus necessitating “independent, controllable, safe, and reliable” chains.

Beijing last week outlined strategies for greater self-sufficiency as it unveiled its five-year economic plan after a plenum of top leaders and as tensions with the U.S. intensify. The U.S. has pressured allies to shun equipment from Huawei Technologies Co., barred dozens of China’s largest tech companies from buying American parts, and even slapped bans on ByteDance Ltd.’s TikTok and Tencent Holdings Ltd.’s WeChat.