White House unveils ban on US investment in Chinese tech sectors

LONDON, Aug 10 (MENA) - The Biden administration will ban some US investment into China’s quantum computing, advanced chips and artificial intelligence sectors, as it boosts efforts to stop the Chinese military from accessing American technology and capital, according to the Financial Times.

The new executive order unveiled by President Joe Biden on Wednesday will come into force next year and will also require companies to notify the government of other investments in the three Chinese sectors.

The action will largely affect private equity and venture capital firms as well as US investors in joint ventures with Chinese groups.

A senior US official said it would create a “very targeted” program that would focus on the three sectors that the administration has also marked out in a series of other technology-related measures aimed at China.

“We want to provide bright-line guidance on what is prohibited and separately what is notified,” the official said.

Biden said technological progress in the sectors posed “significant national security risks” because computers could advance in ways that would help develop sophisticated weapons and break cryptographic codes used by spy agencies to protect data.

The order is the latest in a series of actions designed to limit Chinese access to advanced technology in what US national security adviser Jake Sullivan has called a “small yard, high fence” strategy.

Beijing has countered that the US actions are designed to limit its technological progress. China’s commerce ministry on Thursday expressed “serious concern” about the order, saying it “deviates from the principles of fair competition and the market economy that the US consistently advocates” and that Beijing retained the right to take countermeasures.

A second US official said the order would protect American security in a “narrowly targeted manner, while maintaining our longstanding commitment to open investment”.