WASHINGTON: President Donald trump It has escalated a conflict with China over security and technology by issuing an order prohibiting Americans from investing in companies that US officials say are owned or controlled by the Chinese military.
The impact of the order on thursday It wasn’t immediately clear, but it could increase pressure on companies, including telecoms equipment giant Huawei and video surveillance provider Hikvision, which already face U.S. export bans and other sanctions.
It is Trump’s first major move toward China since losing his reelection bid to challenger Joe Biden. Economists and political analysts have said that even if Trump is defeated, he is likely to take more action. Beijing before leaving office on January 20.
Political analysts expect little change in Biden’s policy due to widespread frustration with China’s business and human rights record and allegations of espionage and technology theft.
American officials complain about the ruling Communist Party of China taking advantage of access to American technology and investment to expand its military, which is already one of the largest and most armed in the world.
Thursday’s order complains that the companies aimed to “directly support” the Chinese military, intelligence and security apparatus. He said Beijing “explodes United States investors ” to finance military development by selling securities on the US and foreign financial markets.
The order prohibits US investors from transacting in publicly traded securities issued by any Chinese company designated by the Defense Secretary as linked to the Communist Party’s military wing, the People’s Liberation Army.
The Pentagon previously designated 31 companies as owned or controlled by the Chinese military. Many are military contractors or state-owned companies like the phone operator China Telecom Ltd. But the list also includes Huawei Technologies Ltd. and Hikvision Digital Technology Co., which say they are private and deny being controlled by the military.
Most of those companies do not trade stocks in the United States, but many sell stocks, bonds, and other securities in markets outside of mainland China that are accessible to US investors.
Sales made to divest securities of those companies will be allowed up to one year from now, on November 11, 2021.
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