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WASHINGTON: The Trump administration in its final days took another blow against China and its largest firms on Thursday (January 14), imposing sanctions on officials and companies for alleged misdeeds in the South China Sea and imposing an investment ban on nine more signatures.
The measures will further increase tensions with China, Washington’s strategic rival in Asia, days before President-elect Joe Biden takes office on Wednesday. Biden’s transition team did not immediately respond to a request for comment.
Executives of state-owned companies, officials from the Communist Party of China and the military, along with the oil giant CNOOC, will face new restrictions for allegedly using coercion against states with rival claims from the South China Sea.
Senior US officials told reporters in a call Thursday that the new CNOOC restrictions will not apply to crude oil, refined fuels and liquefied natural gas and will not apply to existing joint ventures with CNOOC that do not operate in the Sea of South China.
Nine Chinese firms were added to the Pentagon’s list of companies with alleged ties to the Chinese military, including aircraft maker Comac and phone maker Xiaomi.
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Those companies will be subject to a new US investment ban that requires US investors to divest holdings of blacklisted companies by November 11, 2021.
In its response, the Chinese embassy referred to comments from the Foreign Ministry on January 7 accusing Washington of “putting political and ideological labels on economic and commercial matters and exploiting its state power to crack down on foreign companies, under the pretext of national security “.
The United States has long opposed China’s extensive territorial claims in the South China Sea, a potentially resource-rich area that is also a strategic trade route. Washington accuses Beijing of intimidating states such as Vietnam and the Philippines that have contrary claims there.
China accuses Washington of trying to destabilize the region by sending warships and planes to the South China Sea.
“The United States supports the claimant states in Southeast Asia that seek to defend their sovereign rights and interests, consistent with international law,” Secretary of State Mike Pompeo said in announcing the sanctions.
Pompeo said Washington was imposing visa restrictions on Chinese state-owned company executives and officials from the Communist Party and the Chinese Navy.
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It said the sanctions were directed against those “responsible or complicit in the large-scale reclamation, construction or militarization of disputed outposts in the South China Sea, or the use of coercion against Southeast Asian claimants to inhibit their access. to the coast resources “.
The restrictions could also apply to immediate family members, he said.
The Commerce Department accused CNOOC of harassing and threatening offshore oil and gas exploration and extraction in the South China Sea, “with the aim of increasing the political risk for interested foreign partners, including Vietnam.”
President Donald Trump’s administration has kept up the pressure in its last days, pointing to what Washington sees as Beijing’s bid to use corporations as a means of harnessing civilian technologies for military purposes.
Commerce Secretary Wilbur Ross said CNOOC acted as “a thug by the People’s Liberation Army to intimidate China’s neighbors” and that the Chinese military “continues to benefit from government policies of civil-military fusion for evil purposes.” .
Ross’s department added CNOOC to an “Entity List” that requires companies to obtain a special license before they can receive exports of high-tech items from US suppliers.
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Chinese aviation company Skyrizon was added to a list of Military End Users (MEU) for its ability to develop military products, including aircraft engines, restricting its access to US exports.
In addition to Comac and Xiaomi, the Pentagon added Advanced Micro-Fabrication Equipment Inc, Luokung Technology, Beijing Zhongguancun Development Investment Center, GOWIN Semiconductor, Grand China Air, Global Tone Communication Technology, and China National Aviation Holding to the list.
Representatives for the Chinese firms did not immediately respond to requests for comment.
On Wednesday, the Trump administration scrapped plans to blacklist Chinese tech giants Alibaba, Tencent and Baidu, four people familiar with the matter said.
