Biden Scales Back Plans To Crackdown On US Investments In China: REPORT
Jason Cohen on March 2, 2023
President Joe Biden is anticipated to sign an executive order that will be less restrictive on U.S. investments in China than expected, prioritizing transparency over restriction, according to Politico.
While the order may prevent new U.S. investment in China’s advanced semiconductor industry, investment probably will not be blocked for any other Chinese tech sectors, Politico reported. The executive order will instead be expected to require U.S. companies to notify federal authorities about their dealings in industries such as quantum computing and artificial intelligence, according to five sources with knowledge of the discussions.
However, the Biden administration told Politico these characterizations of the White House discussions are false. “This administration has from the beginning focused on formulating an approach that addresses national security risks stemming from outbound investments in a way that is implementable and effective – and has a greater impact on the [Chinese government’s] efforts to acquire sensitive capabilities than it has on the competitiveness of American companies,” said Saloni Sharma, a spokesperson for the National Security Council.
The White House is planning to issue the order in late March or early April, but there may be delays and detail changes, according to Politico.
In September 2022, Biden signed an executive order to look more into foreign investments in fields that are essential for U.S. economic power, targeted at blocking Chinese access to important technologies.
Republican Rep. Michael McCaul has said the Biden administration may be considering a ban on investment in high-tech Chinese industries, Politico reported on Jan. 27.
There was also discussion of establishing a federal review panel that would have the authority to screen and deny a broad range of American investments in China that threaten national security, but that no longer has momentum. There were plans to attach legislation for this to the CHIPS Act, but those never materialized, according to Politico.
So the expected executive order represents a retreat from these more severe measures and would signify that the U.S. is no longer so focused on damaging China’s tech sector. It also shows how substantial the mutual economic interests of the U.S. and China are, according to Politico.
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