Millions in US wage subsidies dollars for small businesses end up in China

Posted by admin Africa & World Politics, American Politics, Headlines, NNP News Sunday, August 2nd, 2020

(NNP) As the Trump administration blames China for introducing the corona virus to the world wrecking global economy, it now has to deal with the revelation that millions of dollars from the Congressional allocation of $660 billion meant for US small businesses as wage subsidies to cushion the impact of the coronavirus, has ended up in China.

According to Horizon Advisory, a consulting firm that reviewed the data, the amount ranges from $192 million to $419 million that has gone to about 125 companies that are owned by Chinese entities or invested in by Chinese businesses. This unintended flow of wage subsidies to China is due to the lack of provision and safeguards embedded in the loan administration that could have prevented US companies with foreign subsidiaries, particularly those in China, from benefitting from the loan.

The cofounders of the Horizon Advisory wrote, “The extent and nature of P.R.C.-owned, -invested and -connected entities among the P.P.P. loan recipients indicate that without appropriate policy guardrails, U.S. tax dollars intended for relief, recovery and growth of the U.S. economy — and small businesses in particular — risk supporting foreign competitors, namely China.”

This occurrence underscores the interconnectedness and interwoven nature of the two largest economies in the world. President Trump has repeatedly said that China should be punished for its role in damaging a once thrifting US economy and has promised a series of measures in concert with allies against China. This week, Trump promised to ban the use of TikTot, a famous Chinese short-term video app that has already been banned in India. Trump has said it presented a national security risk. The president rejected a suggestion by Microsoft to buy the app from its Chinese-owned parent company.

-Written by NewNigerianPoliticswp_posts