International

Trump Backs Off Initial Plan On Chinese Tech Investment Ban

In remarks to White House reporters, President Donald Trump said he supports U.S. Treasury Secretary Steven Mnuchin’s more measured approach to limiting Chinese investments in U.S. tech companies. Earlier this week, it was reported that the Treasury Department was gearing up to announce rules that would prevent companies with 25 percent or more Chinese ownership from purchasing a U.S. company that has “industrially significant technology.”

Trump had already announced plans to place tariffs on billions of dollars of Chinese products, with the first $34 billion-worth of tariffs taking effect on July 6.  Sources said the investment restrictions will be focused on certain sectors, including China’s Made in China 2025 plan, in which it aims to enhance its expertise in advanced information technology, aerospace, marine engineering, pharmaceuticals, advance energy vehicles, robotics and other high tech areas.

While Mnuchin said on Monday (June 25) that the rules would apply to “all countries that are trying to steal our technology,” White House trade adviser Peter Navarro said they would be focused specifically on China, according to Reuters.

Trump echoed Mnuchin’s statement when asked about the proposed restrictions at a meeting with Republican lawmakers on Tuesday (June 26): “We have the greatest technology in the world. People copy it, and they steal it. But we have the great scientists, we have the great brains and we have to protect that, and we’re going to protect it and that’s what we’re doing. And that can be done through CFIUS. We have a lot of things we can do it through and we’re working that out.”

Also on Tuesday (June 26), the U.S. House of Representatives passed legislation to bolster the authority of CFIUS. That legislation, along with a similar Senate-passed bill, would expand CFIUS reviews to minority stakes in U.S. companies and investments that may reveal information on critical infrastructure to foreign governments.

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