WASHINGTON (AP) — The U.S. Treasury Department on Monday issued rules restricting and monitoring U.S. investments in China in artificial intelligence, computer chips and quantum computing, in an effort to prevent China’s military from gaining an edge in advanced technology. announced.
The final rule is based on an executive order issued by President Joe Biden in August 2023. The order allows “countries of concern,” specifically China, Hong Kong, and Macau, to borrow US dollars to fund technology that could be used, for example, to break codes or develop next-generation fighter jets. They wanted to restrict access. It goes into effect on January 2nd.
Paul Rosen, assistant secretary of the Treasury for investment security, said: “U.S. investments must not be used to support the development of military, intelligence, or cyber capabilities of countries of concern.” He pointed out that investing can mean more than just money. They can provide “intangible benefits” such as managerial support, finding top talent, and access to other sources of funding.
Halting China’s high-tech ambitions is one of the few issues that enjoys broad support from both Republicans and Democrats in Washington.
In May, Biden imposed tough tariffs on electric vehicles from China. He also imposed export controls to prevent China from obtaining advanced computer chips and the equipment to make them. Former President Donald Trump has vowed to significantly increase taxes on all imports from China if voters return him to the White House.
The Biden administration sought comment from businesses and U.S. allies before releasing the final version.
In addition to blocking investments, the rule requires U.S. persons and U.S. companies to notify the U.S. government of transactions involving “technology or products that may pose a threat to the national security of the United States.” are.
Violators are subject to fines of up to $368,136 or twice the amount of the prohibited transaction, whichever is greater. The Treasury Department is creating an Office of International Trade to oversee the new rules.
Hong Kong leader John Lee said at his weekly briefing Tuesday that the restrictions are yet another reflection of how some U.S. politicians are undermining normal investment and trade for political gain. He said these actions would harm global supply chains. Lee said the United States has enjoyed a $472 billion trade surplus with Hong Kong over the past decade.
“In pursuing their own political agendas, American politicians harm the interests of not only other countries but also their own country, its people, and its businesses. They must face the consequences of their actions. “It won’t be,” he said.
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Associated Press writer Canis Leung in Hong Kong contributed to this report.
