US plans curbs on Chinese investments
The US treasury department is planning to heighten scrutiny of Chinese investments in sensitive US industries under an emergency law, putting Washington’s trade war with Beijing on a potentially irreversible course.
Under the plan, the White House would use one of the most significant legal measures available to declare China’s investment in US companies involved in technologies such as new-energy vehicles, robotics and aerospace a threat to economic and national security, according to eight people familiar with the plans.
Treasury secretary Steven Mnuchin, in a report scheduled to be released on June 29, will suggest administering that law through an inter-agency government panel called the Committee on Foreign Investments in the US, or CFIUS, the people said, requesting anonymity to discuss the plans.
One concept under review would be to create a two-tracked CFIUS process to review investments, with one specifically for China, two of the people said. A Treasury spokesman did not immediately reply to a request for comment.
China’s ministry of commerce didn’t immediately respond to Bloomberg’s inquiry about the report of planned investment curbs from the US. At a regular briefing in Beijing on Monday, foreign ministry spokesman Geng Shuang said China wants the US to treat commercial activities objectively and pointed out that Chinese investment has created a lot of jobs and tax income in the US.
“It is now clear that Trump’s
WASHINGTON:
policy is not about the trade deficit,” said Raymond Yeung, chief greater China economist for Australia & New Zealand Banking Group Ltd. in Hong Kong. “Security risks can be applied to every aspect in a bilateral relationship, investment restrictions in particular.”
Stocks fell in Asia with U.S. equity-index futures and the yen advanced as investors assessed prospects for continuing trade tensions. Mnuchin has been working on the plans since as early as December, though he’s argued for taking a less aggressive approach, the people said.