On Wednesday, its National Bureau of Statistics reported a 0.3% decline in consumer prices in July from a year ago. It affects the normal business decisions of enterprises, disrupts the international economic and trade order and seriously disrupts the security of global industrial and supply chains.”Ĭhina’s strong economic growth has stumbled coming out of pandemic lockdowns. In its statement, the Chinese Ministry of Commerce said the executive order “seriously deviates from the market economy and fair competition principles the United States has always advocated. That chilling now risks turning into a deep freeze.” Beijing’s so-called ‘national security’ and ‘anti-espionage’ laws that curb routine and necessary corporate due diligence and compliance were already having a chilling effect on U.S. and multinational companies are already reexamining the risks of investing in China. “The message it sends to the market may be far more decisive,” said Elaine Dezenski, a senior director at the Foundation for Defense of Democracies. officials have long signaled the coming executive order on investing in China, but it’s unclear whether financial markets will regard it as a tapered step or a continued escalation of tensions at a fragile moment. Chamber of Commerce said it met a number of times with the White House and federal agencies as the order was being prepared and said its goal during the comment period will be “to ensure the measure is targeted and administrable.” Taiwan’s status has been a source of tension, with Biden saying that China had become coercive regarding its independence.Ĭhina has supported Russia after its 2022 invasion of Ukraine, though Biden has noted that the friendship has not extended to the shipment of weapons. shooting down a spy balloon from China that floated over the United States. investment in China’s critical technology and military companies - period.”īiden has called Chinese President Xi Jinping a “dictator” in the aftermath of the U.S. ambassador to the United Nations, said Biden should been more aggressive, saying, “we have to stop all U.S. Raja Krishnamoorthi, D-Ill., said the order was an “essential step forward,” but it “cannot be the final step.” Republican presidential candidate Nikki Haley, a former U.S.
Yet reaction to Biden’s order on Wednesday showed a desire to push harder on China. In July by a vote of 91-6, the Senate added as an amendment to the National Defense Authorization Act requirements to monitor and limit investments in countries of concern, including China. “While the executive order is limited initially to semiconductors and microelectronics, quantum information technologies, and artificial intelligence, it explicitly provides for a future broadening to other sectors.” government and industry regarding the details of the ultimate screening regime,” Ludvigson said. “The executive order issued today really represents the start of a conversation between the U.S. Philip Ludvigson, a lawyer and former Treasury official, said the order was an initial framework that could be expanded over time. Officials said the order is focused on areas such as private equity, venture capital and joint partnerships in which the investments could possibly give countries of concern such as China additional knowledge and military capabilities. government about certain types of transactions with China as well as to place prohibitions on some investments. The goals of the order would be to have investors notify the U.S. The Treasury Department, which would monitor the investments, will announce a proposed rulemaking with definitions that would conform to the presidential order and go through a public comment process. The new limits were tailored not to disrupt China’s economy, but they would complement the export controls on advanced computer chips from last year that led to pushback by Chinese officials.
investments to support the development of weapons and modernize its military. The officials previewing the order said that China has exploited U.S. “Worry about China, but don’t worry about China,” Biden told donors at a June fundraising event in California.
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