US President Joe Biden has expanded the list of Chinese companies that US investors are prohibited from investing in due to their alleged links with the Chinese military.
Biden came to meet 31 Chinese companies banned by Donald Trump, but he has added 28 more to make 59, with Huawei, Chinese operators and Semiconductor Manufacturing International Corp still remaining on the list.
This move by Biden reinforces the allegation and actions initiated by former President Trump, who was widely accused of a witch-hunt, due to unfounded claims against Chinese companies.
An executive order by Biden on the ban is due to take effect on 2 August, with enforcement being passed from the Department of Defense (DOD) to the Department of the Treasury.
The executive order gives US investors up to 356 days (one year) to divest their holdings in the Chinese listed companies.
The main reason for Biden’s decision in contained in a factsheet that names Huawei and Hangzhou Hikvision Digital Technology as suppliers of surveillance technology.
In the factsheet, the President stated the use or development of “Chinese surveillance technology” outside China “constitute unusual and extraordinary threats” to human rights.
He said additional steps are necessary to address the threat posed by China’s military-industrial complex.
Meanwhile, Chinese officials are threatening to retaliate.
Mobile World Live reports that Chinese foreign ministry representative, Wang Wenbi said at a press conference that China will take necessary measures to support its companies in defending their rights and interests according to law.
“The US should respect rule of law and the market, correct its mistakes and stop actions that undermine the global financial market order,” Wenbi said.
Since Biden came to office, the Chinese government and individual Chinese companies have made attempts to get him to reverse the sanctions Trump placed on them but to no avail.
However, last week, Chinese smartphone maker Xiaomi succeeded in a bid to be removed from the US Department of Defense list.
Huawei, which suffered the biggest hit from the US sanctions, has reported recovering gradually on the back of divesting its operations and looking at new areas, as its smartphone shipment plunges.