Politico: White House scales back plans to regulate U.S. investments in China

(JW Insights) Mar 1 -- Biden is scaling back a planned executive order to oversee American investments in China to focus largely on increasing transparency of those deals, Politico reported on February 27.

The order may still prohibit U.S. investments in at least one Chinese industry — advanced semiconductors — but will likely not block money from flowing to other parts of China’s high-tech economy. Instead, the order is now expected to largely require U.S. firms to notify federal authorities when doing deals in industries like quantum computing and artificial intelligence, though some other investment prohibitions are being debated.

The White House is now expected to issue the order in late March or early April, though further delays are possible if final details cannot be resolved, said Politico.

Saloni Sharma, a spokesperson for the National Security Council, said that “The premise of this story is false, and its characterization of the planned requirements of an outbound investment program is inaccurate. This administration has from the beginning focused on formulating an approach that addresses national security risks stemming from outbound investments in a way that is implementable and effective – and has a greater impact on the [Chinese government’s] efforts to acquire sensitive capabilities than it has on the competitiveness of American companies.”

(Yuan XY)