Biden limits investment in China’s high-tech industries

US President Joe Biden signed decree on limiting direct investment in certain high-tech industries in countries of “concern”. These countries include China, including the special administrative regions of Hong Kong and Macau.

The document allows the US Department of the Treasury to prohibit or restrict investments in companies whose activities are related to sensitive technologies that are critical to national security in three sectors. These are semiconductors and microelectronics, quantum information technologies and artificial intelligence.

“The Biden-Harris Administration is committed to keeping America safe and protecting America’s national security by protecting technologies that are critical to the next generation of military innovation,” commented Decree of the press service of the White House.

Ministry of Foreign Affairs of China expressed dissatisfaction with Biden’s decree, making a presentation to the American side. The United States, under the pretext of protecting national security, in reality seeks to “deprive China of the right to develop and protect its own hegemony and selfish interests,” Beijing said.

“This is undisguised economic coercion and technological intimidation. The actions of the United States have seriously violated the principles of a market economy and fair competition, and seriously undermined the international economic and trade order,” the Chinese Foreign Ministry said in a statement.

The PRC called on the United States to stop politicizing and weaponizing economic, trade and technology issues, and to rescind the decree.

As noted by experts interviewed by Vedomosti, this initiative, which the American media had previously learned about, fits into the general outline of relations between the United States and China. At the same time, start-ups that relied on US venture capital companies, rather than established technology corporations, will suffer from the decree’s effect in the first place, sinologist Leonid Kovacic pointed out. At the same time, experts drew attention to the fact that work on the decree lasted almost a year, so that all interested parties had time to adapt.

June 2023 Microsoft transferred its key AI developers from China to Canada, and the flow of direct and venture investments from the United States to China has decreased more than three times since 2019, said Alexander Sivolobov, Deputy Head of the Skoltech-based NTI Competence Center for Wireless Communications and the Internet of Things .