Friday, March 5, 2021
Home WORLD US BANS AMERICANS FROM INVESTING IN COMPANIES WITH CHINESE MILITARY TIES

US BANS AMERICANS FROM INVESTING IN COMPANIES WITH CHINESE MILITARY TIES

TAIPEI (Taiwan News) — President Donald Trump signed an executive order on Thursday (Nov. 12) barring Americans from investing in Chinese companies that supply or support China’s military, intelligence, and security services.

- Advertisement -

The order bans U.S. companies and citizens from owning shares in 31 Chinese companies either directly or through funds, The Wall Street Journal (WSJ) reported. On the list are large state-run aerospace, shipbuilding, construction, and technology firms, including China Mobile Communications Group, China Telecommunications Corporation, Huawei, Sinochem Group, Hangzhou Hikvision Digital Technology, China Railway Construction Corporation, Inspur Group, and the Aviation Industry Corporation of China, according to The New York Times.

The new rules take effect on Jan. 11 and prohibit the purchase of shares in the companies or investment in emerging market funds that involve the firms. The order gives investors until November 2021 to divest from the Chinese securities.

Many of the 31 companies are traded on the Chinese and Hong Kong stock exchanges, and shares in some of the firms are purchased by investors as part of mutual or other funds, according to WSJ. China Mobile Communications and China Telecommunications Corp. have units whose shares or depositary receipts trade on the New York Stock Exchange.

White House officials told WSJ that it is unknown how many Americans own securities in these Chinese companies or even how much money has been invested. It is unclear at this point whether the incoming Joe Biden administration will overturn the investment ban.

China has pursued a strategy of looking to private and state-owned companies to support its military and intelligence agencies, the Times reported. This has led to calls in Washington for additional measures against Chinese companies, even if they are not formally owned by the Chinese Communist Party (CCP).

- Advertisement -

“American capital should not be used to finance the construction of Chinese communist weapons literally aimed at killing Americans and driving the U.S. military out of Asia,” said Peter Navarro, director of the White House Office of Trade and Manufacturing Policy. “This strong action by President Trump puts a stop to that Wall Street insanity.”

Florida Senator Marco Rubio also supported the move, telling the Times that, “The Chinese Communist Party’s exploitation of U.S. capital markets is a clear and ongoing risk to U.S. economic and national security.” He added, “Today’s action also lays down a clear marker for U.S. policy going forward — we can never put the interests of the Chinese Communist Party and Wall Street above American workers and mom-and-pop investors.”

- Advertisement -
- Advertisement -

Most Popular

- Advertisement -
Get new posts by email

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -

Related News

You cannot copy content of this page