In a First, Biden to Limit US Investments in Advanced Tech AbroadIn a First, Biden to Limit US Investments in Advanced Tech Abroad
China warns U.S. that it is risking ‘conflict and confrontation’
March 7, 2023
At a Glance
- In a first, U.S. plans to limit American investments in foreign countries’ advanced tech if it affects national security.
- China warns that if U.S. does not change course, ‘surely’ there will be conflict.
- New rules follow restrictions on sales of advanced chips to China.
The Biden administration is looking at imposing measures to restrict U.S. investment in advanced technologies abroad that could pose a national security risk.
According to The Wall Street Journal, the Treasury and Commerce departments informed lawmakers of the plans last week, with the prospective restrictions focusing on sectors that could advance the military capabilities of rival countries.
The program is expected to restrict private equity and venture-capital investments covering some forms of AI, advanced semiconductors and quantum computing.
No country was named as a target, but the Journal cited sources saying they expect the new rules would largely target China.
The U.S. has long scrutinized foreign investment coming into the U.S., but regulating American investment abroad is new.
Treasury and Commerce have requested additional funding in the White House budget, ahead of next week’s release. The new program will be open to public comments.
However, the Biden administration is struggling with setting the scope of these rules and how the U.S. investor would comply with them.
Coming conflict with China
The latest move by the Biden administration follows last October’s unveiling of new restrictions on exports of AI-focused semiconductors and related equipment to China based on national security concerns.
The U.S. government is lobbying allies to follow suit. Japan and The Netherlands have imposed similar sanctions in late January and the topic could come up in G7 meetings this May.
Today, China’s foreign minister, Qin Gang, warned that the U.S. and China are headed for “conflict and confrontation” if America does not change course, according to The Associated Press.
“If the United States does not hit the brake, but continues to speed down the wrong path, no amount of guardrails can prevent derailing and there surely will be conflict and confrontation,” he said.
“Such competition is a reckless gamble, with the stakes being the fundamental interests of the two peoples and even the future of humanity.”
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