A senior government source told Reuters that the White House would outline its proposals on Wednesday to forbid some US investments in sensitive technology in China and demand that the government be notified of other transactions.
The proposals are intended to stop U.S. resources from funding the development of technologies that would aid China’s military modernization and jeopardize U.S. national security.
President Joe Biden was anticipated to sign the long-awaited executive order to screen export investments in sensitive technologies to China this week, according to Reuters on Friday.
According to a senior government source, the order is anticipated for Wednesday. On Tuesday, the White House opted not to comment.
For months, Biden administration officials have emphasized that any limitations on American investment in China will be strictly targeted.
National Security Advisor Jake Sullivan stated that “these are tailored measures” in April. “They are not a ‘technology blockade,'” according to Beijing.
American employees and the economy are harmed by anything that is unduly broad, according to U.S. Commerce Secretary Gina Raimondo, who stated this in March.
The administration is anticipated to focus on active investment, such as American private equity, venture capital, and joint venture investments in China in semiconductors, quantum computing, and artificial intelligence.
According to reports, the majority of the investments covered by the directive will necessitate informing the government about them. Certain transactions will be forbidden.
According to a story in the New York Times on Tuesday, the Biden administration intends to make it mandatory for companies investing in a wider variety of Chinese businesses to disclose their activity. This will provide the American government with excellent visibility into financial transactions between the United States and China.
The U.S. Department of Commerce announced export control regulations for China in October, and sources previously told Reuters that investments in semiconductors that will be prohibited are anticipated to follow those regulations.
The Center for Strategic and International Studies (CSIS), a nonpartisan organization that conducts policy research, is led by Emily Benson. She anticipates that military users and uses of investments in artificial intelligence will be prohibited, while other investments in the industry will only require government notification.
The administration will have the responsibility of determining what AI qualifies as military, according to Benson.
According to Benson, director of the CSIS project on trade and technology, “they will have to define AI and draw a line between what constitutes a military application of AI.”
The publishing of a notice of proposed rule-making is anticipated to be ordered by Biden’s order. It is anticipated that it will not go into effect right away and that a comment period will be offered before it is finalized to take industry feedback into account.
