US President Donald Trump wants to offer tax credits to entice US firms to move factories out of China.
He has also threatened to strip government contracts from firms that continue to outsource work to China.
In a speech on Monday, Mr. Trump vowed to create 10 million jobs in 10 months saying “We will end our reliance on China.”
It marks his latest attack on China, after moves that have involved tech companies TikTok, WeChat and Huawei.
The announcement came as tensions between Washington and Beijing have been escalating rapidly in recent months.
The Trump administration is now casting its net beyond the Chinese technology companies it has accused of threatening US national security.
“We will create tax credits for companies that bring jobs from China back to America,” Mr Trump said. “We built the greatest economy in the history of the world and now I have to do it again.”
Chinese communications giant Huawei has repeatedly come under attack by the US government and on Monday further restrictions were placed on the company to limit the electrical components it can buy.
The Trump administration has also threatened to include more Chinese technology firms on its blacklist of companies which face bans in the US, alongside TikTok and WeChat,
