The Trump Administration has added nine Chinese companies, including Chinese plane maker Comac and mobile phone maker Xiaomi, to a trade blacklist which Washington thinks are owned or controlled by the Chinese military.
These companies will be subject to a new U.S. investment ban which will compel American investors to divest their holdings of the blacklisted firms by Nov. 11, 2021.
Neither, Xiaomi or Comac immediately responded to requests for comment.
The bipartisan move is part of a broader effort by Washington to take reciprocal steps against Beijing, which has tried to leverage the benefits of democracies and its institutions, including market driven economy, while keeping a tight lid on its economy and market. Beijing also tries to lure companies with its huge market where foreign companies are forced to compete with Chinese state-backed peers, in a blatant lob-sided approach which skews market forces favoring its own domestic companies.
A 1999 law requires the Department of Defense to compile a catalogue a list of companies owned or controlled by the Chinese military. The Pentagon began complying with this law only this year and has so far added 35 companies to its list including oil giant CNOOC and China’s top chipmaker SMIC.
In November, Trump added teeth to the law by signing an executive order banning U.S. investment of the blacklisted firms.