That China and the United States have not seen eye-to-eye on anything from freedom of speech to economic priorities should not surprise anyone. Yet, President Donald Trump signed a memorandum on Friday that directed the Committee on Foreign Investment in the United States or CFIUS, as the body is known more snappily, to impose investment restrictions on a trio of foreign adversaries, and specifically Hong Kong, Macau, and China.
President Trump Gets Tough on China in New Memorandum Both Hong Kong and Macau are special administrative regions (SARs) under the control of Beijing, and all three have been seen as a threat to national security, as President Trump is also forcing ByteDance, the Chinese owners of social media video-sharing app TikTok, to sell to an American businessman.
The new memorandum strikes a distinctly presidential tone with its “American First Investment Policy” name and it precludes investment from the aforementioned jurisdictions. According to President Trump, investments are directly tied to national security and should be directed in a manner that ensures the strategic advantage of the United States.
As a result, CFIUS is now directed to analyze investments potentially made by individuals or/and companies that are associated with China. Essentially, the regulator is looking for any money flowing into critical infrastructure, agriculture, health care, energy, technology, and other sensitive areas.
The country is also looking to curb future investment from anyone associated with the adversaries. The outflow of capital has not been restricted as much, and it’s unlikely for Macau to be impacted insofar as casino resorts are concerned.
The new memorandum has elicited a rebuttal from China, with the country’s Ministry of Commerce arguing that what the United States was doing was highly atypical and hurt normal economic relationships not just between the countries, but also any overseas potential investor.
China Ready to Protect Its Own Interest, Future Collaborations Unclear “China will keep a close watch on the US side and take necessary measures to defend its legitimate rights and interests,” the ministry said. China and the United States have been arguing a lot over-investment in their respective countries.
China seems close to Elon Musk, the billionaire owner of Tesla, SpaceX and a number of other high-tech companies, who received the go-ahead to launch self-driving cars in China seen as a potential rapprochement between the two countries.
China may be hoping to soothe President Trump to a degree by demonstrating that there are areas in which the two countries can collaborate. However, the recent memorandum is a step away from that.
