American businesses seeking to operate overseas typically face few barriers from the U.S. government. But when it comes to China, a bipartisan group of lawmakers — and the White House — want to change that.
Congress is considering legislation allowing the government to screen American investments in China and other adversarial nations — and potentially deny them if a project threatens national security. At the same time, the White House is talking about issuing executive orders to increase scrutiny of American funding for Chinese startups and technology firms, expanding a ban that today only exists for a select group of firms aligned with the Chinese military.
Taken together, the actions would represent an unprecedented expansion of government oversight sure to chill some American investment in the Chinese economy and escalate commercial tensions with Beijing. But supporters say they are necessary to stop American banks from funding China’s technological development and prevent U.S. supply chains from being reliant on Beijing for goods used in critical industries, like medicine, energy and defense.
“We’re in an economic war, whether we want to use that language [or not],” said Sen. Bob Casey (D-Pa.), who is leading a bill with Sen. John Cornyn (R-Texas) that would expand oversight of U.S. supply chains in China. “I think it requires that we examine some issues that maybe 10 or 15 years ago we didn’t have to worry about.”
See also: US Report Finds Big Weaknesses In China’s Defence Industry Base