Trump to crack down on Chinese investment in American science & technology industries
Washington DC: President Donald Trump is set to announce new measures this week to target growing Chinese investment in key technologies in the US, according to media reports, which could further escalate the trade war between the world's two largest economies.
The measures are part of the same broad US move to confront Beijing over its unfair trade practices as the tariffs on USD 50 billion of Chinese goods that the Trump administration detailed earlier this month, the reports said.
China has vowed to strike back in equal measure against the tariffs, the first wave of which are due to take effect July 6. President Trump plans to ratchet commercial tensions higher by barring many Chinese companies from investing in US technology firms, and by blocking additional technology exports to Beijing, The Wall Street Journal reported, quoting people familiar with administration's plans. The twin initiatives, set to be announced by the end of the week, are designed to prevent Beijing from moving ahead with plans outlined in its 'Made in China 2025' report to become a global leader in 10 broad areas of technology, including information technology, aerospace, electric vehicles and biotechnology, it said.
The Treasury Department is crafting rules that would block firms with at least 25 per cent Chinese ownership from buying companies involved in what the White House calls "industrially significant technology."
The ceiling may end up lower than that, according to people familiar with discussions finalising the plans, the report said. The White House has said previously that details of the investment restrictions, as well as "enhanced export controls" limiting Chinese acquisition of US technology, will be announced by June 30.
The possible restrictions of Chinese investments in the US come at a time of rapidly declining Chinese investment in the US. It plunged more than 90 per cent in the first five months of 2018 compared with the same period a year earlier, CNN quoted a report last week by Rhodium Group, a research firm that tracks Chinese foreign investment.
