The U.S. has issued an executive order on foreign investment review, restricting U.S. companies’ outbound investments in sectors including semiconductors and microelectronics, quantum information, and artificial intelligence. How should we view this move?

President Biden signed the order, again imposing 'chokepoint' restrictions on China in three key areas! The Chinese Ministry of Foreign Affairs urges: Immediately rescind this erroneous decision. According to Global Times, citing Reuters and other media reports on September 9, U.S. President Joe Biden signed, on Wednesday (local time, September 9), an executive order on 'restrictions on U.S. investment in China.' This order strictly limits U.S. investment in China’s sensitive technology sectors and requires U.S. enterprises to report to the U.S. government on their investment activities in China across other technological fields. In its latest report, Reuters stated that the executive order authorizes the U.S. Department of the Treasury to prohibit or restrict U.S. investment in Chinese entities operating in three areas: semiconductors and microelectronics, quantum information technologies, and artificial intelligence systems. In response to President Biden’s recent signing of the executive order restricting U.S. investment in China, on August 10, China’s Ministry of Commerce and Ministry of Foreign Affairs issued successive statements. Ministry of Commerce Response: A journalist asked: Early this morning Beijing time, the White House issued an executive order on foreign investment review. What is China’s comment on this? Answer: We have noted the U.S. executive order on foreign investment review. By restricting its domestic enterprises’ outbound investment, the U.S. side—under the pretext of 'de-risking'—is pursuing 'decoupling and supply-chain disruption' in the investment domain. This seriously deviates from the market economy and fair competition principles long advocated by the U.S., interferes with enterprises’ normal business decisions, undermines international trade and economic order, and severely disrupts the security of global industrial and supply chains. China expresses grave concern over this and reserves the right to take countermeasures. We urge the U.S. side to respect the laws of the market economy and principles of fair competition, refrain from artificially obstructing global trade and economic exchanges and cooperation, and avoid creating barriers to the world economy’s recovery and growth.

U.S. semiconductor policies targeting China escalate! New regulations are promulgated and enter into force on January 2.

• Prohibited transactions: Any transaction related to the development of AI systems specifically designed or intended for certain end-uses is prohibited. Transactions related to developing AI systems trained using computational power exceeding 10^25 operations—or trained primarily on biological sequence data using computational power exceeding 10^24 operations—are likewise prohibited. • Reportable transactions: Transactions related to developing AI systems that are either (i) designed or intended for certain end-uses or applications, or (ii) trained using computational power exceeding 10^23 operations, must be reported. Under the final rule, the U.S. Department of the Treasury may impose civil penalties for violations and may refer criminal violations to the U.S. Attorney General. As of the date the final rule is published, the maximum civil penalty for a violation is $368,136 (adjusted annually for inflation) or twice the value of the violative transaction—whichever is greater. Today’s publication of the final rule notice marks the concluding step in the process announced by U.S. President Biden in his August 2023 executive order, aimed at 'addressing U.S. concerns regarding investments by U.S. persons in certain national security-related technologies and products in countries of concern.' Last August, China’s Foreign Ministry Spokesperson responded to reporters’ questions regarding President Biden’s signing of the executive order restricting U.S. investment in China: 'China expresses strong dissatisfaction and firm opposition to the U.S. side’s insistence on introducing investment-restriction measures against China, and has lodged solemn representations with the U.S. side. Under the guise of 'national security,' the U.S. side restricts American enterprises’ investment in China, excessively broadening the definition of security concerns and politicizing economic and technological issues. Its true objective is to deprive China of its right to development and safeguard its own hegemonic interests—a blatant form of economic coercion and technological bullying. Such actions seriously violate market economy and fair competition principles, severely undermine international trade and economic order, gravely disrupt stability in global industrial and supply chains, and severely harm the interests of businesses in both China and the United States—and indeed worldwide. In essence, this is a move toward de-globalization and decoupling from China. China urges the U.S. side to earnestly honor President Biden’s commitment not to 'decouple' from China and not to impede China’s economic development; to cease politicizing, instrumentalizing, and weaponizing economic and technological issues; to immediately rescind its erroneous decision; to lift investment restrictions against China; and to foster a favorable environment for China-U.S. economic and trade cooperation.'

China Urges US to Halt Proposed Expansion of Outbound Investment Curbs

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China's Commerce Ministry urged the US to stop expanding investment restrictions that now include biotechnology, warning it would disrupt trade ties and damage bilateral economic relations.

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China Urges US to Halt Proposed Expansion of Outbound Investment Curbs

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