China Responds to Biden’s Executive Order

China has criticized President Joe Biden’s long-awaited executive order that regulates fresh U.S. investment in technology. However, China has not yet announced any immediate counter measures.

The Chinese Commerce Ministry issued a strong response, expressing grave concern and reserving the right to implement measures. This statement came shortly after Biden signed off on the measure, which targets “countries of concern” based on national security.

The Aim of Biden’s Order

Biden’s executive order aims to limit U.S. investment and expertise in semiconductors and microelectronics, quantum computing, and certain artificial intelligence capabilities in China, Hong Kong, and Macao. It does not impose an outright ban but focuses on restricting U.S. involvement in these areas.

China’s Criticism

The Chinese Ministry of Commerce criticized the order, stating that it deviates from market economy principles and fair competition. They argue that it negatively affects the normal operation and decision-making of enterprises, disrupts the international economic and trade order, and poses a threat to the security of global industrial and supply chains.

Previous Actions and Assurances

In October, the U.S. introduced rules to cut off exports of key chips and semiconductor tools to China. Additionally, U.S. Treasury Secretary Janet Yellen assured Chinese counterparts in July that any restrictions on outbound investments from the U.S. would be transparent and narrowly targeted.

Comparison to Previous Legislation

The wording of Biden’s executive order resembles a toned-down version of the initial Outbound Investment Transparency Act introduced in the Senate. Instead of an outright ban, the revised wording now requires U.S. firms to notify the Treasury when investing in advanced Chinese technology due to national security concerns.

— HaberTusba’s Evelyn Cheng contributed to this story.

This is a developing story. Please check back for more updates.