US plans to curb Chinese investment in tech firms
washington — The US Treasury Department is drafting curbs that would block firms with at least 25 per cent Chinese ownership from buying US companies with “industrially significant technology,” a government official briefed on the matter said on Sunday.
The official, whose comments matched a report by the Wall Street Journal, emphasised that the Chinese ownership threshold may change before the restrictions are announced on Friday.
The move marks another escalation of President Donald Trump’s trade conflict with China, which threatens to roil financial markets and dent global growth.
Tariffs on $34 billion worth of Chinese goods, the first of a potential total of $450 billion, are due to take effect on July 6 over US complaints that China is misappropriating US technology through joint venture rules and other policies.
The Treasury investment restrictions are expected to target key sectors, including several China is trying to develop as part of its ‘Made in China 2025’ industrial plan, the US official said.
Among its objectives, the plan aims to upgrade China’s capabilities in advanced information technology, aerospace, marine engineering, pharmaceuticals,
advanced energy vehicles, robotics and other high-technology industries.
The Wall Street Journal also said the US Commerce Department and National Security Council were proposing “enhanced” export controls to keep such technologies from being shipped to China.
The government official said the Treasury would invoke the International Emergency Economic Powers Act of 1977 (IEEPA) to devise the restrictions. The act gives the president sweeping authority to restrict assets based on national security concerns. IEEPA was invoked broadly after the 9/11 attacks in 2001 to cut off financing for terrorist networks.
The Journal said the administration would look only at new deals and would not try to unwind existing ones, adding that the planned investment bar would not distinguish between Chinese state-owned and private companies.
frankfurt — Britain’s looming departure from the European Union has led nearly half of big companies from the rest of the bloc to cut investment in the country, a poll of 800 executives released two years after the Brexit referendum found.
The survey, by law firm Baker & McKenzie, also found that three quarters of bosses wanted Brussels to make concessions to Britain to secure a better trading relationship after it leaves the EU in early 2019.
“It’s very clear that, especially German companies, think that Brexit is bad for business,” said Anahita Thoms, a trade partner at Baker & McKenzie in Duesseldorf.
Germany’s BDI industry group warned last week that Britain is heading towards a disorderly Brexit that could have disastrous consequences.
Airbus has said a withdrawal without a deal would force the aircraft maker to reconsider its longterm position and put thousands of British jobs at risk.
However, Prime Minister Theresa May’s spokeswoman said the government was confident
of getting a good deal ensuring trade is as free and frictionless as possible.
Asked whether punishing Britain for leaving the EU or continuing to trade on preferential terms was more important, 96 per cent of respondents to the survey said trade was more important than teaching London a lesson for Brexit.
There was also a majority view that business leaders had not been properly consulted, or their views taken into account, by the EU negotiating team as it tries to hammer out a postBrexit trade deal.