US Aims to choke Chinese Tech Industry by restricting investment

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On Wednesday, American President Joe Biden issued a decree aimed at limiting American investments in the Chinese tech industry, primarily focusing on investments in chips, artificial intelligence, and quantum computers.

Investments in the mentioned sectors can not only be restricted but also prohibited by the Department of the Treasury. The long-anticipated measure is intended to prevent American funds and expertise from aiding China in developing technologies that could support the modernization of the Chinese military, as reported by Reuters.

“American money has contributed to the rise of the Chinese military for far too long,” says Chuck Schumer, leader of the Democrats in the Senate. “Today, the United States takes a strategic first step to ensure that American investments are not used to finance Chinese military advancement.”

US officials emphasize that the restrictions are meant to address the “most acute” national security risks and not to sever the economies of the two countries.

China expressed on Thursday that it is “deeply concerned” about the decree and that taking countermeasures is not ruled out. The order affects the normal operations and decision-making of businesses and undermines the international trade order, stated the Chinese Ministry of Commerce. The Chinese embassy in Washington also conveyed its “deep disappointment in the US government.”

A longstanding trade conflict has been ongoing between the United States and China. In October of last year, the US imposed extensive export restrictions on chips and chip production equipment to China, and urged allies to do the same. The US was in negotiations with the Netherlands and Japan, both of which export chip production equipment. Dutch companies are required to apply for a license starting September 1st to export certain semiconductor production equipment, although China is not explicitly mentioned in the export restrictions.


By: Abaigael Schlomski

Abaigael Schlomski is an accomplished economist and financial journalist with over a decade of experience in the industry. He is a regular contributor to EconomicInform, where he provides in-depth analysis and expert commentary on the latest economic trends and events. With a keen understanding of the financial markets and a talent for breaking down complex economic concepts for a general audience, Maurice is a trusted and respected voice in the field.

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