President Donald Trump banned Americans from investing in any companies that United States officials believe are owned or controlled by the People’s Liberation Party of China.
In an Executive Order addressing threats from investments that finance China’s military, President Trump said the Communist country is “increasingly exploiting United States capital” in order to develop and modernize the Chinese military and intelligence.
The president went on to say that the exploitation allows China to “directly threaten” the United States.
“I therefore find that the PRC’s military-industrial complex … constitutes an unusual and extraordinary threat, which has its source in substantial part outside the United States, to the national security, foreign policy, and economy of the United States,” President Trump’s executive order read. “To protect the United States homeland and the American people, I hereby declare a national emergency with respect to this threat.”
In response to Thursday’s order, the Chinese government said the move was an excuse to obstruct competition, warning that Washington’s misuse of national security would hurt the United States and global investors, The Associated Press reported.
The order has the potential to put pressure on companies like telecom giant Huawei and video surveillance provider Hikvision, two companies that are already impacted by U.S. export bans and additional sanctions.
On Friday, China’s foreign ministry said Washington was “wantonly suppressing Chinese companies under the pretext of national security” and disrupting market principles.
“The U.S. government maliciously slandered China’s military-civilian integration development policy out of political motives and abused national power to unreasonably suppress Chinese companies,” said a foreign ministry spokesman, Wang Wenbin.
“This move will not only seriously damage the legitimate rights and interests of Chinese companies, but will also damage the interests of investors from all countries, including the United States,” Wang said.
President Trump’s order marks the first action taken against China since Election Day. With no official winner of the presidency, and in the midst of numerous election-related lawsuits alleging voter fraud and suppression, economists and political analysts believe President Trump will likely launch more moves against Beijing.
If Biden does take office in January, political analysts don’t anticipate sweeping changes in policy regarding China due to frustration with the CCP’s trade, human rights issues, and accusations involving spying and technology theft, the AP reported.
President Trump’s already-strained relationship with the Chinese government was intensified this year in the midst of the COVID-19 pandemic, a global emergency he has accused China of starting.
“In the earliest days of the virus, China locked down travel domestically while allowing flights to leave China and infect the world,” President Trump said in a speech to the U.N. General Assembly earlier this year. “China condemned my travel ban on their country, even as they canceled domestic flights and locked citizens in their homes.”
He added, “The Chinese government and the World Health Organization — which is virtually controlled by China — falsely declared that there was no evidence of human-to-human transmission. Later, they falsely said people without symptoms would not spread the disease.”