United States President Joe Biden has signed an executive order which provides new limitations on US investments in Chinese tech sectors.
The order, coming after a ban last October preventing China from buying US-made computer chips and chip-making equipment, seeks to stifle US investment in Chinese artificial technology, quantum computing, and semiconductors in an effort to limit military technological advancements.
The limitations will also require companies investing in China to report activity to the government, with the US Treasury expecting to give exemptions to “certain transactions, including potentially those in publicly traded instruments and intracompany transfers from US parents to subsidiaries”.
Officials emphasised that the order was a national security decision rather than an economic one.
“Ultimately, China doesn’t need our money”, one senior official said.
“They’re a net capital exporter. So, the thing we’re trying to prevent is not money going into China overall, because they have plenty of money, the thing they don’t have is know-how.”
However, Republicans such as former UN ambassador and current Republican presidential nominee Nikki Haley believe the restrictions should be taken further, describing the limitations as “not even a half measure”.
“To stop funding China’s military, we have to stop all US investment in China’s critical technology and military companies — period,” she added.
A spokesperson from the Chinese embassy in Washington said the restrictions would “hurt both Chinese and American businesses, interfere with normal cooperation and reduce investor confidence in the US,” adding that more than 70,000 US companies conduct business in China and that “China’s repeated expressions of deep concern” had been ignored by the Biden administration.
The limitations are due to come into effect next year following multiple rounds of public comment.
Photo: American and Chinese flags and USA dollars by Carolina Grabowska available HERE and used under a Creative Commons license. This image has not been modified.
