Jakarta -The US Treasury Department plans to increase the supervision of Chinese investment in sensitive US industries under emergency law. The move, potentially again boosting trade wars between the two countries.
The White House will use one of the most significant legal steps to declare China’s investment in US technology-related companies such as new energy vehicles, robotics and aeronautics as a threat to economic and national security, according to eight sources familiar with the plan.
According to unnamed sources, Finance Minister Steven Mnuchin, in a report scheduled for release on June 29, will file the rule through an intergovernmental government panel called the Foreign Investment Committee in the US (CFIUS).
One concept under review is to create two CFIUS traceable processes for reviewing investments, with one process aimed specifically at China.
“It is now clear that Trump’s policy is not about the trade deficit,” said Raymond Yeung, China’s chief economist for Australia & New Zealand Banking Group Ltd., as quoted by Bloomberg.
“Security risks can be applied to every aspect of bilateral relations, particularly investment restrictions,” he continued.
On the other hand, China’s Ministry of Commerce has not responded to the US planned investment monitoring report.
Mnuchin has been working on the plan since early December, though he argued for taking a less aggressive approach. Ultimately, he has been persuaded by other members of the Cabinet and the president to be tougher to cope with rising national security risks from Chinese investment.