Trump administration readies crackdown on U.S. investments in Chinese firms

Clay Curtis
November 16, 2020

Some of the other companies listed, including China Telecom and China Mobile, trade on the New York Stock Exchange, it said.

"The president's action serves to protect American investors from unintentionally providing capital that goes to enhancing the capabilities of the People's Liberation Army and People's Republic of China intelligence services, which routinely target American citizens and businesses", said Robert O'Brien, the United States national security adviser, according to The Financial Times.

The order will prohibit United States investment firms and pension funds from conducting transactions in 20 Chinese companies that the Pentagon has designated as having military ties in June, in addition to 11 companies added in late August.

Chinese Foreign ministry spokesman Wang Wenbin.

The executive order "serves to protect American investors from unintentionally providing capital that goes to enhancing the capabilities of the People's Liberation Army and People's Republic of China intelligence services", said Robert O'Brien, Trump's national security adviser, in a statement issued Thursday.

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The order, which could impact some of China's biggest companies, including telecoms firms China Telecom Corp Ltd, China Mobile Ltd and surveillance equipment maker Hikvision, could be released as soon as Thursday, two USA officials and one other person familiar with the matter said. Investors who now hold shares, the order goes on to demand, have until November 2021 to completely divest them.

The order also came months after the Trump administration pressured one of the country's largest pension funds to halt a plan to pour billions of dollars into an index including Chinese companies, sparking worries over an accelerated financial decoupling between the world's two largest economies.

China has put sanctions on United States companies selling weapons to Taiwan and flew fighter jets near the island when senior USA officials visited Taipei this year. President Trump has mounted pressure on China over its alleged meddling in USA elections to help Joe Biden.

The Communist Party of China claims Taiwan as its own territory, even though it has never ruled the island of 24 million, which has its own democratically-elected government, military and foreign policy.

Relations between China and the United States are at their worst in decades over disputes ranging from technology and trade to Hong Kong and the coronavirus, and the Trump administration has unleashed a barrage of sanctions against Beijing.

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