House seal

House · Hearing transcript

Advancing National Security through Commercial Diplomacy

Tuesday, February 24, 2026

Summary

  • Jacob Helberg announced the State Department is prioritizing commercial diplomacy to counter Chinese economic coercion by leveraging private sector investment and multilateral frameworks like the Indo-Pacific Economic Framework.
  • Jacob Helberg (Under Secretary of State for Economic Growth, Energy, and Environment) testified that the U.S. must provide transparent, market-based alternatives to China's predatory lending in the Global South.
  • Rep. Christopher Smith (R-NJ-4) pressed Helberg on preventing dual-use technology transfers to China, leading Helberg to describe a "small yard, high fence" strategy for protecting foundational technologies.
  • Rep. Brian Mast (R-FL-21) and Rep. Gregory Meeks (D-NY-5) agreed on countering Chinese economic influence, though Meeks emphasized aligning commercial engagements with human rights and labor standards.
  • The State Department will continue expanding the Mineral Security Partnership and IPEF to secure critical mineral supply chains and establish 21st-century digital trade rules with global partners.
Hearing Details

Witnesses

Members Who Spoke

View on Congress.gov

Transcript

Opening Statements

Rep. Mast (FL-21)2:174:12

[Gavel sounds.] The committee will come to order. The Chair is authorized to declare a recess of the committee at any time and without objection is directed to provide a 24-hour notice of any markup. I now recognize myself for an opening statement. Today, we are here to discuss a critical, yet often overlooked, pillar of our foreign policy: commercial diplomacy. In an era of intensifying global competition, our economic tools are just as vital as our military and traditional diplomatic ones. For too long, we have allowed our adversaries, particularly the Chinese Communist Party, to weaponize trade and investment to expand their influence and undermine the rules-based international order. They use predatory lending, forced technology transfers, and state-subsidized industries to gain a foothold in strategic markets around the world. To counter this, the United States must be more proactive. We must leverage our greatest strength: our private sector. Commercial diplomacy is about more than just helping American companies sell products abroad; it is about advancing our national security interests by building resilient supply chains, promoting high standards, and offering a transparent alternative to the CCP's model. I am pleased to welcome our witness today, Under Secretary Jacob Helberg, who has been at the forefront of these efforts at the State Department. I look forward to hearing about how the Department is integrating economic statecraft into our broader foreign policy strategy. With that, I recognize the Ranking Member, Mr. Meeks, for his opening statement.

Rep. Meeks (NY-5)4:125:27

Thank you, Mr. Chairman. And thank you, Under Secretary Helberg, for being here today. This is a timely and important hearing. As we navigate a complex global landscape, the intersection of economics and national security has never been more apparent. Commercial diplomacy is a vital tool for promoting American values and interests. By fostering economic growth and stability in partner nations, we create a more secure and prosperous world for everyone. However, we must also ensure that our commercial engagements are aligned with our commitment to human rights, labor standards, and environmental protection. I am particularly interested in hearing how the State Department is working with our allies and partners to coordinate our economic policies. We cannot go it alone. A multilateral approach is essential to effectively addressing the challenges posed by non-market economies and ensuring a level playing field for American businesses. I yield back.

Rep. Mast (FL-21)5:275:42

The gentleman yields back. I now recognize the witness, the Honorable Jacob Helberg, Under Secretary of State for Economic Growth, Energy, and Environment. Your full statement will be made part of the record. You are recognized for five minutes.

Helberg (Witness)5:427:32

Chairman Mast, Ranking Member Meeks, and members of the committee, thank you for the opportunity to testify today on the critical role of commercial diplomacy in advancing our national security. It is an honor to be here. In today's interconnected world, economic security is national security. The State Department is committed to using every tool at our disposal to ensure that the United States remains the world's leading economic power and that our businesses can compete and win on a level playing field. This requires a whole-of-government approach and close collaboration with the private sector. Our commercial diplomacy efforts are focused on three key areas: first, securing critical supply chains for essential technologies and resources; second, promoting American innovation and setting global standards for emerging technologies like AI and quantum computing; and third, providing a positive economic alternative to the coercive practices of our adversaries. We are working tirelessly to deepen our economic ties with like-minded partners through initiatives like the Indo-Pacific Economic Framework and the Americas Partnership for Economic Prosperity. These frameworks are not just about trade; they are about building a coalition of nations committed to transparency, sustainability, and the rule of law. I look forward to your questions.

Countering CCP Economic Coercion

Rep. Mast (FL-21)7:327:47

Thank you, Mr. Under Secretary. I will now recognize myself for five minutes of questioning. Mr. Helberg, you mentioned the CCP's coercive economic practices. Can you give us some specific examples of how they are using these tactics to gain influence in Africa and Latin America?

Helberg (Witness)7:4732:32

Certainly, Mr. Chairman. In Africa, we see the CCP using 'debt-trap diplomacy,' where they provide large, opaque loans for infrastructure projects that countries often cannot afford to repay. When these countries default, the CCP takes control of strategic assets like ports or mines. In Latin America, they use their dominant position in certain sectors to pressure governments into making political concessions. ...and the United States must lead in setting the standards for these technologies. If we do not, our adversaries will, and they will use them to undermine our interests and our values.

Rep. Mast (FL-21)32:3232:39

Thank you, Mr. Helberg. I now recognize the Ranking Member, Mr. Meeks, for any opening remarks he may have.

Rep. Meeks (NY-5)32:3934:02

Thank you, Mr. Chairman. And thank you, Mr. Helberg, for being here today. Commercial diplomacy is a critical tool in our foreign policy toolkit. As we navigate an increasingly complex global landscape, the intersection of economics and national security has never been more apparent. We must ensure that our American companies can compete on a level playing field abroad, while also protecting our critical infrastructure and supply chains from foreign interference. I am particularly interested in hearing your thoughts on how we can better coordinate with our allies to address the challenges posed by non-market economies and the theft of intellectual property. We cannot do this alone. It requires a multilateral approach that leverages our collective economic strength. I look forward to your testimony and to our discussion today. I yield back.

Securing Telecommunications and 5G Networks

Rep. Mast (FL-21)34:0234:12

The gentleman yields back. I now recognize myself for five minutes for questions. Mr. Helberg, in your testimony, you mentioned the importance of 'trusted vendors' in our telecommunications networks.

Helberg (Witness)34:1234:47

That is correct, Mr. Chairman. Ensuring that our 5G infrastructure and future 6G developments are built upon hardware and software from companies that are not subject to the control of adversarial regimes is a top priority for the State Department. We are working closely with partners around the world through initiatives like the Clean Network to promote secure and reliable digital ecosystems.

Rep. Mast (FL-21)34:4735:02

How are we incentivizing developing nations to choose these trusted vendors over cheaper, subsidized options from countries like China?

Helberg (Witness)35:0235:47

It is a significant challenge. We are utilizing tools like the DFC, the Development Finance Corporation, to provide viable financing alternatives. We are also emphasizing the long-term costs of choosing untrusted vendors, including the risks to data privacy, national sovereignty, and the potential for 'debt-trap' diplomacy. Commercial diplomacy is about showing that the American model of transparent, market-based investment is a better long-term partner.

Rep. Mast (FL-21)35:4735:52

Thank you. My time has expired. I now recognize the Ranking Member for his questions.

Workforce Development and Human Capital

Rep. Meeks (NY-5)35:5236:32

Thank you, Mr. Chairman. Mr. Helberg, following up on that, how are we addressing the workforce needs for these emerging technologies? If we want to lead in AI and quantum computing, we need the talent. Are we doing enough to attract and retain the best minds globally while also investing in our domestic STEM education?

Helberg (Witness)36:3237:17

You hit on a vital point, Ranking Member Meeks. Human capital is the ultimate resource in this competition. The State Department works with the Department of Labor and Education to align our diplomatic efforts with domestic workforce development. We are also looking at visa policies to ensure that we remain the destination of choice for global innovators. National security depends on our ability to out-innovate, and that starts with people.

Export Controls and Technology De-risking

Unknown Male Speaker1:02:171:02:32

...and the private sector. We need to make sure that our commercial diplomacy is not just about selling products, but about building lasting partnerships that enhance our collective security. I yield back.

Rep. Mast (FL-21)1:02:321:02:39

The gentleman yields back. The Chair now recognizes the gentleman from New Jersey, Mr. Smith, for five minutes.

Rep. Smith (NJ-4)1:02:391:06:02

Thank you very much, Mr. Chairman. And thank you, Mr. Helberg, for your testimony and for your leadership on these critical issues. You know, for decades, many of us have been concerned about the transfer of dual-use technology to the People's Republic of China. We've seen how the CCP uses commercial ties to advance its military modernization and its surveillance state. In your testimony, you mentioned the importance of 'de-risking' our economic relationship with China. Could you elaborate on how the Department is working with our allies to ensure that commercial diplomacy doesn't inadvertently strengthen the military capabilities of our adversaries? Specifically, how are we coordinating on export controls and investment screening to prevent the leakage of sensitive technologies?

Helberg (Witness)1:06:021:07:47

Thank you, Congressman Smith. That is a central pillar of our strategy. De-risking is not about decoupling across the board, but about being very surgical and clear-eyed about where dependencies create national security vulnerabilities. We are working intensely through the G7 and with other key partners to align our export control regimes. For example, we've seen unprecedented cooperation on advanced semiconductors and the equipment needed to make them. On investment screening, we are sharing best practices with allies who are standing up their own versions of CFIUS to ensure that outbound and inbound investment doesn't become a backdoor for technology transfer. Commercial diplomacy here means creating a common operating picture with our partners so that if one country restricts a sensitive technology, another doesn't simply step in to fill the void.

Rep. Smith (NJ-4)1:07:471:08:32

I appreciate that. One follow-up: how do we ensure that American small and medium-sized enterprises, which are often the engines of innovation, are protected from intellectual property theft while still being encouraged to compete globally? Often they don't have the resources of a multinational corporation to defend themselves.

Helberg (Witness)1:08:321:10:02

It's a great point. We've expanded our outreach through the Department's regional hubs and our commercial service officers. We provide 'know your customer' guidance and threat briefings specifically tailored for SMEs. We want them to export, but we want them to do so with their eyes wide open. We're also working to provide alternative markets so they don't feel pressured to enter high-risk environments just to survive.

Rep. Smith (NJ-4)1:10:021:10:07

Thank you. My time is expiring. I yield back.

Rep. Mast (FL-21)1:10:071:10:15

The gentleman yields back. The Chair now recognizes the gentleman from California, Mr. Sherman, for five minutes.

Financing Alternatives to Belt and Road

Rep. Sherman (CA-32)1:10:151:13:37

Thank you, Mr. Chairman. Mr. Helberg, I want to talk about the 'diplomacy' part of commercial diplomacy. For too long, our trade policy was divorced from our foreign policy. We thought that if we just traded with everyone, they would eventually become like us. That theory has been proven wrong, especially with China. Now, as we look at the Global South, we see China using the Belt and Road Initiative to create debt traps and gain political leverage. How is the State Department using commercial diplomacy to offer a better value proposition? It's not enough to tell countries 'don't use Huawei.' We have to offer an affordable, secure alternative. Where are we on financing those alternatives through the DFC or EXIM bank?

Helberg (Witness)1:13:371:16:07

Congressman, you've hit on the most important competitive challenge we face. We cannot beat something with nothing. Our approach is to lead with high-quality, transparent, and sustainable investment. Through the Partnership for Global Infrastructure and Investment, or PGI, we are mobilizing hundreds of billions of dollars. We are working closely with the DFC to de-risk private capital. For instance, in the Lobito Corridor in Africa, we aren't just building a railway; we are connecting mines to ports and bringing digital connectivity along the route. This provides a transparent alternative to the opaque deals often associated with the BRI. We are also working on 'Rip and Replace' programs for telecommunications to help countries transition to trusted vendors like Ericsson, Nokia, or Samsung.

Rep. Sherman (CA-32)1:16:071:17:02

But the scale of BRI is massive. Are we actually moving fast enough? The bureaucracy at DFC and EXIM can sometimes be a hurdle for companies trying to compete with state-backed Chinese firms that can move in weeks, not years.

Helberg (Witness)1:17:021:18:27

We recognize the need for speed. We are working to streamline those processes. But I would also argue that our 'product' is better. Countries are beginning to realize that Chinese 'cheap' capital comes with high long-term costs to their sovereignty. Our commercial diplomacy emphasizes that an American partnership is a partnership of equals based on the rule of law.

Rep. Sherman (CA-32)1:18:271:18:32

Thank you. I yield back.

Rep. Mast (FL-21)1:18:321:18:39

The gentleman yields back. The Chair now recognizes the gentleman from South Carolina, Mr. Wilson, for five minutes.

Energy Security and Critical Minerals

Rep. Wilson (SC-2)1:18:391:21:57

Thank you, Mr. Chairman. And thank you, Mr. Helberg, for being here. I'm particularly interested in the role of energy in commercial diplomacy. We've seen how Russia has used energy as a weapon against Europe. Our ability to export LNG and develop civil nuclear partnerships is a huge strategic asset. Can you discuss how the Department is promoting U.S. energy exports as a tool of national security, particularly in Eastern Europe and the Indo-Pacific?

Helberg (Witness)1:21:571:24:32

Energy security is national security. Since the invasion of Ukraine, we have worked tirelessly to help our European allies diversify away from Russian gas. U.S. LNG has been a literal lifesaver for the European economy. Beyond fossil fuels, we are very focused on the next generation of energy technology. We are promoting U.S. Small Modular Reactor technology, or SMRs, through programs like FIRST. This allows us to build 100-year relationships with countries as they build out their carbon-free energy grids. In the Indo-Pacific, we are working through the Just Energy Transition Partnerships to help countries move away from coal while ensuring their energy independence from coercive suppliers.

Rep. Wilson (SC-2)1:24:321:25:17

That's excellent. On the topic of critical minerals, which are essential for both traditional and renewable energy, how are we securing those supply chains so we aren't trading dependence on Russian gas for dependence on Chinese minerals?

Helberg (Witness)1:25:171:27:47

That is the Mineral Security Partnership, or MSP. We've brought together 14 partner countries and the EU to coordinate investment in mining, processing, and recycling of critical minerals. We want to ensure that these minerals are produced with high ESG standards, which distinguishes us from the PRC's approach. We are looking at projects in Africa, Latin America, and Central Asia to ensure a diversified and resilient global supply chain.

Rep. Wilson (SC-2)1:27:471:27:52

Thank you. I yield back.

Rep. Mast (FL-21)1:27:521:27:59

The gentleman yields back. The Chair now recognizes the gentleman from California, Mr. Bera, for five minutes.

Indo-Pacific Economic Framework Strategy

Rep. Bera (CA-6)1:27:591:31:07

Thank you, Mr. Chairman. Mr. Helberg, I want to focus on the Indo-Pacific Economic Framework, or IPEF. While it's not a traditional trade agreement, it is a key part of our commercial diplomacy in the region. Some of our partners in the region have expressed a desire for more market access. How do we keep them engaged in IPEF and ensure it delivers tangible benefits that counter China's influence, like RCEP?

Helberg (Witness)1:31:071:32:17

IPEF is designed for the 21st-century economy. While it doesn't include traditional tariff reductions, it addresses the 'behind the border' issues that are actually the biggest barriers to trade today: supply chain resilience, the digital economy, clean energy standards, and anti-corruption. We've already seen the first-of-its-kind Supply Chain Agreement come into force. This creates a crisis response mechanism so that if there's another pandemic or a natural disaster, we have a pre-negotiated way to keep goods moving. That is a huge tangible benefit for businesses in all 14 member countries.

Rep. Bera (CA-6)1:32:171:32:32

...and the potential for commercial diplomacy to be a tool for us to use to counter that. I'll start with you, Mr. Helberg. How can we better coordinate our commercial diplomacy with our allies to present a united front against China's economic coercion?

Helberg (Witness)1:32:321:33:15

Thank you, Congressman. I think the most important thing we can do is to provide an alternative. For a long time, the Chinese government was the only game in town in many parts of the world, particularly in the developing world, when it came to infrastructure financing and technology. By working with our allies through initiatives like the G7's Partnership for Global Infrastructure and Investment, we are now offering a value proposition that is based on transparency, high standards, and debt sustainability. We also need to harmonize our export controls and investment screening mechanisms so that we aren't undercut by our own partners when we take necessary steps to protect our national security.

Rep. Bera (CA-6)1:33:151:33:29

Thank you. And in the remaining time, I'd like to ask about the role of the private sector. How can the State Department better incentivize American companies to align their international investments with our strategic interests?

Helberg (Witness)1:33:291:34:12

It's a critical question. Commercial diplomacy is a two-way street. We provide the political support and the de-risking tools through agencies like the DFC and EXIM, but we need the private sector to bring the capital and the innovation. We are increasingly engaging in 'deal teams' at our embassies to help U.S. companies navigate foreign markets and compete against state-backed entities. We want to make sure that when an American company is looking to invest abroad, they know the U.S. government has their back, especially in sectors like semiconductors, clean energy, and telecommunications.

Rep. Bera (CA-6)1:34:121:34:19

Thank you. My time has expired. I yield back. I now recognize the gentleman from New York, Mr. Meeks.

Rep. Meeks (NY-5)1:34:191:34:32

Thank you, Mr. Chairman. Mr. Helberg, welcome. I want to follow up on the point about the Global South. We see China's Belt and Road Initiative having a significant footprint in Africa and Latin America. How is the State Department specifically targeting those regions?

Helberg (Witness)1:34:322:02:32

Ranking Member Meeks, you've hit on a priority area. In Africa, for example, we are focused on the Lobito Corridor, which is a massive rail project that will connect the Democratic Republic of the Congo and Zambia to global markets through the Port of Lobito in Angola. This isn't just about transport; it's about creating an economic ecosystem. By investing in this infrastructure, we're opening up opportunities for American companies in mining, agriculture, and digital connectivity. It's a model for how we can compete by providing high-quality, sustainable alternatives to the BRI. ...and the strategic importance of these commercial ties cannot be overstated. When we talk about national security, we must include the economic tools that allow us to compete on the global stage.

Rep. Mast (FL-21)2:02:322:02:59

Thank you, Mr. Helberg. I now recognize the gentleman from New Jersey, Mr. Smith, for five minutes.

Rep. Smith (NJ-4)2:02:592:04:12

Thank you very much, Mr. Chairman. And thank you, Mr. Secretary, for your testimony and for your leadership. I'm particularly concerned about the role of technology transfers in our commercial diplomacy. We've seen instances where American innovation, intended for commercial use, ends up being diverted for military purposes by our adversaries, particularly the PRC. How is the State Department working with the Department of Commerce to tighten export controls without stifling the very innovation that gives us our competitive edge? It seems like a very delicate balancing act.

Helberg (Witness)2:04:122:05:27

Thank you, Congressman Smith. You've hit on one of the most critical challenges we face. We are in constant coordination with the Bureau of Industry and Security at Commerce. Our approach is 'small yard, high fence.' We want to identify those specific, foundational technologies—like advanced semiconductors, quantum computing, and certain AI applications—that are critical to military modernization and put very high fences around them. At the same time, we want to ensure that the vast majority of commercial trade, which doesn't pose a security risk, can continue to flourish. It requires a granular understanding of the end-use and the end-user.

Rep. Smith (NJ-4)2:05:272:06:02

I appreciate that. Following up on that, how are we engaging our allies in this? Because if we restrict a technology but our allies in Europe or Asia continue to sell it to the PRC, we've only succeeded in hurting American companies without actually stopping the technology transfer. Is there a multilateral framework that is actually working right now?

Helberg (Witness)2:06:022:07:22

That is exactly why commercial diplomacy is so vital. We are working through the G7, the TTC with the European Union, and bilateral engagements to align our export control regimes. It's not always easy, as different countries have different economic dependencies, but there is a growing consensus that the security risks are shared. We are seeing much more alignment now than we did even two years ago on things like outbound investment screening and 5G security.

Rep. Smith (NJ-4)2:07:222:07:29

Thank you. My time is expiring. I yield back.

Rep. Mast (FL-21)2:07:292:07:37

The gentleman yields back. I now recognize the Ranking Member, Mr. Meeks, for five minutes.

Rep. Meeks (NY-5)2:07:372:09:02

Thank you, Mr. Chairman. Mr. Secretary, I want to pivot slightly to the Global South. We often see the PRC using their Belt and Road Initiative to gain leverage through infrastructure projects that often lead to debt traps. How is the State Department using commercial diplomacy to provide a viable, transparent alternative for developing nations that want to build their digital and physical infrastructure without sacrificing their sovereignty?

Helberg (Witness)2:09:022:10:32

Ranking Member Meeks, that is a top priority for Secretary Blinken and myself. Through the Partnership for Global Infrastructure and Investment, or PGI, we are mobilizing private capital to invest in high-quality, sustainable infrastructure. We aren't just showing up with a check; we are showing up with a value proposition that includes transparency, environmental standards, and local labor protections. We are also working through the DFC to provide the kind of de-risking that makes these markets attractive to American institutional investors.

Rep. Meeks (NY-5)2:10:322:10:57

And specifically on the digital front? We know that once a country adopts a certain telecommunications backbone, it's very hard to switch. Are we being competitive enough in offering alternatives to Huawei and ZTE in Africa and Latin America?

Helberg (Witness)2:10:572:12:17

We are making progress, but we have more work to do. We are promoting Open RAN technology, which allows for a more diverse and secure vendor ecosystem. By breaking the proprietary lock that companies like Huawei have, we allow smaller, often Western, companies to compete on individual components of the network. We're providing technical assistance to regulators in these countries to help them understand the long-term security and economic costs of 'cheap' equipment that comes with backdoors.

Rep. Meeks (NY-5)2:12:172:12:22

Thank you. I yield back the balance of my time.

Rep. Mast (FL-21)2:12:222:12:32

The gentleman yields. I now recognize the gentleman from South Carolina, Mr. Wilson.

Rep. Wilson (SC-2)2:12:322:13:47

Thank you, Mr. Chairman. Mr. Secretary, I'm interested in the energy security aspect of your portfolio. We've seen how Russia has used energy as a weapon against our European allies. As we look toward the energy transition, how are we ensuring that we don't trade a dependence on Russian gas for a dependence on Chinese critical minerals and solar supply chains? What is the State Department doing to diversify those supply chains?

Helberg (Witness)2:13:472:15:17

Congressman Wilson, that is a central pillar of our strategy. We established the Minerals Security Partnership, which now includes 14 partners and the EU. The goal is to catalyze public and private investment in critical mineral supply chains that are transparent and adhere to high ESG standards. We are looking at the entire value chain—from mining to processing to recycling. We cannot have a single point of failure in the green energy transition. We are working with countries like Australia, Canada, and several African nations to ensure there are diverse sources for lithium, cobalt, and rare earth elements.

Rep. Wilson (SC-2)2:15:172:15:42

Is the State Department actively helping American companies secure mining rights or processing contracts in these countries to compete with the state-backed Chinese firms?

Helberg (Witness)2:15:422:17:02

Yes, our embassies are very active in this. Our economic officers on the ground are identifying opportunities and helping American firms navigate the local regulatory environments. We also use our diplomatic weight to advocate for fair bidding processes. When American companies compete on a level playing field, they win because they bring better technology and better business practices. Our job is to ensure that the field is actually level.

Rep. Wilson (SC-2)2:17:022:17:07

Thank you. I yield back.

Rep. Mast (FL-21)2:17:072:17:17

The gentleman yields. I now recognize the gentleman from California, Mr. Bera.

Rep. Bera (CA-6)2:17:172:18:32

Thank you, Mr. Chairman. Mr. Secretary, I want to talk about the Indo-Pacific Economic Framework, or IPEF. There's been some concern that without the market access components of a traditional trade agreement, IPEF might not be as attractive to our partners in Southeast Asia. How are you using the commercial diplomacy side of the State Department to add 'meat to the bones' of IPEF and show our partners that the U.S. is fully committed to the region economically?

Helberg (Witness)2:18:322:20:02

Congressman Bera, IPEF is a 21st-century framework designed for 21st-century challenges. While it doesn't include traditional tariff reductions, it addresses the things that businesses tell us matter most today: supply chain resilience, clean energy standards, and digital trade rules. We are using IPEF to create a more predictable and transparent business environment. For example, the Supply Chain Agreement under IPEF is the first of its kind, creating a 'crisis response network' so that if there's another disruption like we saw during COVID, we have a formal mechanism to coordinate with our partners in the region.

Rep. Bera (CA-6)2:20:022:20:27

That's helpful. But are you hearing from the private sector that this is enough to incentivize them to move manufacturing out of China and into IPEF partner countries like Vietnam or Indonesia?

Helberg (Witness)2:20:272:21:47

We are. Companies are looking for 'derisking' and 'friend-shoring.' They want to know that if they move a factory to Vietnam, the rules of the road will be clear and the infrastructure will be reliable. IPEF provides that framework. We're also seeing a lot of interest in the 'Clean Economy' pillar, where U.S. technology in carbon capture and green hydrogen can find new markets. The commercial diplomacy part is connecting those U.S. innovators with the projects being developed under the IPEF umbrella.

Rep. Bera (CA-6)2:21:472:21:52

Thank you. I yield back.

Rep. Mast (FL-21)2:21:522:22:02

The gentleman yields. I now recognize the gentleman from California, Mr. Sherman.

Dollar Primacy and Digital Currency

Rep. Sherman (CA-32)2:22:022:23:17

Thank you. Mr. Secretary, I want to talk about the dollar. Our ability to use economic sanctions effectively depends on the U.S. dollar remaining the world's primary reserve currency. We see China and Russia, and even some of our allies, looking for ways to bypass the dollar in international trade. How does your work in commercial diplomacy support the continued primacy of the dollar, and do you see the rise of Central Bank Digital Currencies as a threat to that primacy?

Helberg (Witness)2:23:172:24:47

Congressman Sherman, the strength of the dollar is rooted in the strength of the U.S. economy, the depth of our capital markets, and the rule of law. Our commercial diplomacy reinforces this by promoting the U.S. economic model globally. When we encourage countries to adopt transparent financial standards and open their markets, it naturally favors the use of the dollar. Regarding CBDCs, we are watching this very closely. The Treasury Department is in the lead on the technical side, but from a diplomatic perspective, we want to ensure that any international standards for digital finance reflect our values of privacy and transparency, rather than the surveillance-heavy models we see being developed elsewhere.

Rep. Sherman (CA-32)2:24:472:25:12

If the PRC's digital yuan becomes the standard for trade in the Global South because it's easier or cheaper to use, doesn't that undermine our sanctions power? What are we doing to provide a digital alternative that is just as efficient but maintains our standards?

Helberg (Witness)2:25:122:26:32

That is a significant concern. We are working with our allies and through international financial institutions to modernize cross-border payment systems. The goal is to make dollar-based transactions faster and cheaper so there is no 'efficiency' incentive to switch to a less secure, less transparent alternative. Commercial diplomacy is about making sure the global financial architecture remains grounded in the principles that have served the world well for decades.

Rep. Sherman (CA-32)2:26:322:26:37

Thank you. I yield back.

Rep. Mast (FL-21)2:26:372:26:47

The gentleman yields. I now recognize the gentleman from California, Mr. Issa.

Rep. Issa (CA-48)2:26:472:28:02

Thank you, Mr. Chairman. Mr. Secretary, I want to talk about intellectual property. For years, we've seen the systematic theft of American IP by the PRC. While we talk about diplomacy, they are stealing the very 'seed corn' of our future economy. Is the State Department prepared to take more aggressive commercial diplomatic actions, such as restricting visas for individuals associated with companies known for IP theft, or pushing for more robust enforcement in international forums?

Helberg (Witness)2:28:022:29:32

Congressman Issa, IP protection is a cornerstone of our economic engagement. We use our annual Special 301 Report to identify and pressure countries that fail to protect IP. But we are also going further. We are working with the Department of Justice and the FBI to identify those entities involved in state-sponsored theft and using our diplomatic tools to call them out and, where appropriate, impose costs. We have also tightened visa screening for certain categories of researchers to prevent the illicit transfer of sensitive knowledge. It's a whole-of-government effort.

Rep. Issa (CA-48)2:29:322:29:57

But are we seeing results? It seems like the theft continues unabated. Are there specific countries where our commercial diplomacy has actually led to a measurable decrease in IP infringement?

Helberg (Witness)2:29:572:31:17

We have seen improvements in several partner countries that want to attract more U.S. investment. They realize that if they don't protect IP, American companies won't bring their best technology there. In the case of the PRC, it remains a much more difficult challenge, which is why we've shifted toward more defensive measures like export controls and investment screening. We are also working with our allies to create a unified front, so the PRC can't play one country's companies against another's.

Rep. Issa (CA-48)2:31:172:31:22

Thank you. I yield back.

Rep. Mast (FL-21)2:31:222:32:17

The gentleman yields. The committee will stand in a brief recess for five minutes while we wait for the next round of members to arrive. We will resume shortly.

Rep. Bera (CA-6)2:32:172:32:32

...and that's why I think it's so important that we have a strategy that is proactive and that is focused on the future and not just on the past. And with that, I yield back.

Rep. Mast (FL-21)2:32:322:32:37

The gentleman yields back. I now recognize the gentleman from California, Mr. Issa.

Rep. Issa (CA-48)2:32:372:33:32

Thank you, Mr. Chairman. Mr. Helberg, I want to follow up on some of the points made earlier regarding the role of the private sector in our national security strategy. We've seen how critical it is for our tech companies to be aligned with our national interests, especially when it comes to emerging technologies like AI and quantum computing. How do you see the State Department's role in facilitating that alignment, particularly when these companies are operating in markets that may be hostile to U.S. interests? Are there specific mechanisms or incentives that we should be looking at to ensure that our commercial diplomacy is actually advancing our security goals and not inadvertently undermining them?

Helberg (Witness)2:33:322:35:02

Thank you, Congressman. That is a central question to the work we're doing. The State Department acts as a bridge between the policy objectives of the U.S. government and the operational realities of the private sector. We do this through several mechanisms. First, we provide high-level diplomatic support for U.S. companies competing for major infrastructure and technology projects abroad, ensuring they have a level playing field against state-backed competitors. Second, we engage in deep policy dialogues with our allies to harmonize our approaches to technology standards and export controls. This creates a more predictable environment for our companies. Third, we are increasingly focused on 'de-risking' rather than 'de-coupling,' which means identifying specific vulnerabilities in our supply chains and working with the private sector to build more resilient, diversified sources of supply. It's not about telling companies where they can't go, but rather helping them understand the strategic risks and providing alternatives that align with our national security.

Rep. Issa (CA-48)2:35:022:35:12

I appreciate that. My time is expiring, so I will yield back the balance of my time. Thank you.

Closing Remarks

Rep. Mast (FL-21)2:35:122:35:27

The gentleman yields back. There being no further members present to ask questions, I want to thank our witness for his testimony today. This has been a very productive discussion on a critical topic.

Rep. Meeks (NY-5)2:35:272:35:42

Mr. Chairman, I would just like to add my thanks to the witness as well. This is an area where bipartisan cooperation is essential, and I look forward to continuing this work with you and the committee.

Rep. Mast (FL-21)2:35:422:35:52

Thank you, Ranking Member Meeks. Without objection, the committee stands adjourned. [Gavel sounds.]

Same-day access

Read every hearing transcript the day it happens

Paid seats unlock fresh transcripts immediately, including synced video and clear summaries.