Arkansas Sen. Trent Garner (R-El Dorado) proposed a halt in funding for the Arkansas Economic Development Commission’s operations in China yesterday.
The proposed amendment to the AEDC budget would prevent the department from spending money on a liaison or office in China. It would also prevent the AEDC from expending funds for contractual services in China from both public or private entities.
Garner said the amendment would show China that Arkansas planned to hold them accountable for their actions during the initial outbreak of the novel coronavirus, which occurred in a Chinese market.
“The ‘Wuhan’ COVID-19 was unleashed on the world because of China’s laws and inactions,” he said. “There’s a study showing that if China had acted three weeks earlier, they could have stopped this and not had a local epidemic turn into a global pandemic. China has been a bad actor in this from the beginning.”
Gov. Asa Hutchinson addressed the amendment during the question and answer portion of his daily COVID-19 update.
“To think that we’re not going to have a relationship and a business relationship in the future is short-sighted and somewhat isolationist,” Hutchinson said. “I’m concerned about the amendment itself — that it sends a message that we don’t want to sell agricultural products to China.”
Hutchinson said the state is already working to close its office in China as the pandemic continues; he expects that to be complete June 30, he said. The AEDC budget for China operations has been scaled back by about $120,000 due to the situation. The funds remaining in the budget would be for a liaison to maintain business relationships between Arkansas and China.
However, Garner countered that the pandemic has highlighted an already existing problem with the state’s relationship with China — dependence.
“The importance of this is that we’re seeing our over-reliance on China when we can’t get access to personal protective equipment and supplies … because we moved everything there,” Garner said. “That needs to change.”
Arkansas has faced difficulty in procuring supplies like PPE and ventilators. President Donald Trump has directed states to procure their own supplies, rather than allowing the federal government to bargain on the country’s behalf, which has left Arkansas competing with the other 49 states, the federal government and other countries in a global marketplace.
Garner said China, particularly the Communist Party of China, which is the country’s sole governing party, should face consequences for their role in the spread of the novel coronavirus. He cited reports of whistleblowers being jailed, doctors disappearing and false reporting to the World Health Organization (WHO) as examples of China’s bad actions.
“I thought it was an extreme response by the governor, and I think it shows exactly why we need this bill,” he said. “This bill is a simple and small step in the right direction, and if we can’t do this, it shows we’re not going to hold China accountable, and that’s a huge mistake moving forward.”
Hutchinson defended continued business with China, citing agricultural products like rice, soybean and chicken that Arkansas sells to the country. Trump recently signed the first phase of a new trade deal with China, which included a pledge from China to purchase $40 billion worth of agricultural products from the United States each year.
“When added, an approximate total annualized increase of up to $308 million in export dollars may be gained by Arkansas farmers and businesses with a new deal with China,” Melvin Torres, director of Western Hemisphere trade at World Trade Center Arkansas, told Arkansas Business & Politics in January.
Prior to the new trade deal, farmers in Arkansas were hit hard by a trade war between the U.S. and China. Farmers in the state received $331.086 million in federal support during the trade war to make up for lost profits. In all, the Trump administration authorized $28 billion in farm bailouts for money lost during the trade war.
“Whenever you look at the second-leading economic power in the world and to think that we have a presence of Tyson Foods, the sale of our agricultural products to China, when Walmart is there in China … our rice, our soybeans, our poultry; we’ve got to have a presence there and be able to facilitate that relationship from a commerce standpoint in the future,” Hutchinson said.
China is Arkansas’s fourth-largest foreign trading partner, accounting for $301 million in exports in 2018. Arkansas exported $3.2 billion of agricultural products that year, according to the Office of U.S. Trade Representatives.
Garner said he believes he has good support for his amendment already and expects similar legislation from other General Assembly members to be filed soon.
Sen. Tom Cotton (R-AR) has made comments similar to Garner’s, including referring to COVID-19 as the “Chinese” or “Wuhan” virus, for which he and Trump have received criticism from major news outlets and other politicians. He has cited the same study as Garner, from the University of Southampton and funded by the Bill and Melinda Gates Foundation, which said, in summary, that China could have reduced their cases by up to 95% had social distancing and quarantining measures been enacted there sooner, in his criticism of China.
The U.S. has also been criticized for its handling of the pandemic. In Arkansas, testing capacity has been low throughout the course of the virus’s spread here, calling into question the accuracy of the number of positive cases reported. Trump has personally been criticized by the media and politicians for his slow response to the outbreak in the U.S., as well as his administration’s delegation of supply procurement to states and his own suggestions to citizens to use unproven pharmaceuticals to treat the virus.
“President Trump did move early with the Chinese travel ban, and he formed a task force in January,” Garner said. “Of course hindsight is 20/20, there have probably been mistakes made, but we moved as well as you could have in an unprecedented pandemic. … A few misstatements are a lot different than what the Chinese government did.”
The amendment will be discussed at the Arkansas General Assembly’s fiscal session, which is scheduled to begin Wednesday.