President Joe Biden dealt a blow to Beijing on Thursday when he signed an executive order banning U.S. investment in Chinese companies with alleged defense ties or the sale of surveillance technology.
The order came because of the “unusual and extraordinary threats” China’s surveillance technology posed against democracy, the government said.
“This EO enables the United States to in a targeted and outreach way to prohibit US investment in Chinese companies that undermine the security or democratic values of the United States and our allies,” the White House said in a statement.
The to order, which lists 59 Chinese companies, expands on one issued by President Donald Trump in November.
It prevents U.S. financial aid to Chinese companies associated with the country’s military — both inside and outside China — used to suppress dissent or religious minorities.
President Joe Biden has signed an executive order banning US companies from investing in Chinese companies with alleged ties to defense or the sale of surveillance technology
The order, which lists 59 Chinese companies, is an extension of the order issued by President Donald Trump in November; the original order had 31 firms
There are growing concerns about Beijing’s spy technology — including facial recognition cameras and software, phone scanners and a range of other tools — and how it’s being used.
“I believe that the use of Chinese surveillance technology outside the PRC and the development or use of Chinese surveillance technology to facilitate repression or serious human rights violations pose unusual and extraordinary threats,” Biden said, using the acronym for the People’s Republic of China.
The order comes as Biden has redoubled his attacks on authoritarian regimes, such as those in Russia and China. The first foreign leaders he received at the White House were the Japanese Prime Minister and the President of South Korea — a sign of the importance his administration attaches to the Pacific.
It also comes for his first trip abroad – where he will meet leaders from the G7, NATO and the EU, in addition to a talk with Russian President Vladimir Putin.
The White House said Biden will discuss the importance of democracy during the trip, including how to deal with threats from China and Russia.
White House press secretary Jen Psaki said on Thursday that as part of the trip, the president will discuss “his advocacy for democracy over autocracy at home, here in the United States, but certainly around the world.” He has always felt that we are stronger when we work together with our partners and our allies.”
She noted that those talks would talk about “problematic behavior of some that we disagree about, including Russia, including China.”
By rewriting Trump’s earlier order to include surveillance technology companies — which the Chinese have used against Muslim minorities such as the Uyghurs and dissidents in Hong Kong — the Biden administration has undermined already tense relations between Beijing and Washington. pressured.
China reacted furiously.
“The US government is broadening the concept of national security, abusing national power and using every possible means to suppress and restrict Chinese enterprises,” Wang Wenbin, a spokesman for China’s foreign ministry said, according to Reuters.
“We are strongly against this,” Wang told reporters at a regular briefing on Friday, urging the United States to withdraw the list.
China reacted furiously to Biden’s order; “The US government is broadening the concept of national security, abusing national power and using every possible means to suppress and restrict Chinese enterprises,” said Wang Wenbin, a spokesman for China’s foreign ministry.
The ban will take effect on August 2; US companies would have a year from that date to wind down their investments
Many of the companies on the comprehensive list were already blacklisted by the Department of Defense that restricts access to US technology and investment. The original list contained 31 companies.
The companies include Aviation Industry Corp of China (AVIC), China Mobile Communications Group, China National Offshore Oil Corp (CNOOC), Hangzhou Hikvision Digital Technology Co Ltd, Huawei Technologies Ltd and Semiconductor Manufacturing International Corp (SMIC).
Some of China’s largest telecommunications companies, including China Mobile, China Telecommunications and China Unicom, are also still banned.
The ban will take effect on August 2. American companies have a year from that date to phase out their investments.
And more Chinese companies are expected to join.
“We fully expect that in the coming months we will … add additional companies to the constraints of the new executive order,” a senior official told reporters during a briefing interview.
However, not included were some previously identified companies, such as Commercial Aircraft Corp of China (COMAC), which competes with Boeing Co and Airbus, and two that are challenging the ban in court, Gowin Semiconductor Corp and Luokung Technology Corp.
And Chinese smartphone maker Xiaomi Corp., which overtook Apple as the world’s No. 3 smartphone maker in the third quarter of 2020, was removed from its previous investment blacklist after it sued the US government, saying it had no ties to the Chinese army.