China-US relations

China to assess tougher US controls on foreign investments, wary of impact on its companies

Beijing ministry reviewing US’ strengthening of committee deciding whether foreign investments threaten national security

PUBLISHED : Tuesday, 14 August, 2018, 10:47am
UPDATED : Tuesday, 14 August, 2018, 10:47am

China’s commerce ministry said on Tuesday it will comprehensively assess a new US defence act that strengthens the role of a key committee tasked with reviewing proposed foreign investment, and called for fair treatment of Chinese investors.

US President Donald Trump signed a US$716 billion defence policy act on Monday that authorises military spending and includes watered-down controls on US government contracts with China’s ZTE and Huawei Technologies.

The National Defence Authorisation Act, or NDAA, strengthens the Committee on Foreign Investment in the United States (CFIUS), which reviews proposed foreign investments to weigh whether they threaten national security. That measure was seen as targeting China.

Donald Trump signs defence bill imposing tougher regulations on foreign investments – including China

In a short statement, China’s commerce ministry said it had noted the inclusion of CFIUS in the act and would “comprehensively assess the contents”, paying close attention to the impact on Chinese firms.

“Chinese and US companies have a strong wish to deepen investment cooperation, and the potential is enormous,” the ministry stated.

Failure to name China as focus of strengthened CFIUS investment panel ‘could lead to abuse and loss of money’

“The governments of the two countries should listen to the voices of the companies, and provide a good environment and stable expectations.

“The US side should objectively and fairly treat Chinese investors, and avoid CFIUS becoming an obstacle to investment cooperation between Chinese and US firms.”