The U.S. government is considering restrictive measures against two Chinese tech giants, Alibaba and Tencent, insiders say.
(Deutsche Welle Chinese) Two people familiar with the matter told Reuters recently (Jan. 6) that the two most expensive publicly traded companies in Asia could be blacklisted like online payment platforms such as Alipay and Ant Financial Services, given their suspected ties to the Chinese military. The move would exacerbate tensions between the U.S. and China, the world’s two largest national economies, and comes in the final days of Tripp’s term.
On the 20th of this month, Biden, a Democrat, will lead the next administration. The new administration’s future trade policy with China is unclear.
People familiar with the matter say plans for blacklisting have not been finalized. The blacklisting will make it particularly difficult for companies to access U.S. high-tech resources. Authorities are also discussing whether to add more companies to the list, the sources said. A Chinese Foreign Ministry spokeswoman said China will take all necessary measures to defend the rights and interests of Chinese companies. Alibaba and Tencent have not taken a position yet.
Extended reading: Trump bans 8 more Chinese apps, including Alipay
Shares of Alibaba, China’s largest online business listed in Hong Kong, and Tencent, another Chinese Internet giant, fell significantly on the day.
Investors were critical of the U.S. government for potentially taking this step. The president of Caldwell Investments stressed that money and markets should be neutral and should not exclude the two Chinese companies, which have many American investors also involved, from the United States.
For months, Trump has repeatedly targeted Chinese apps for attacks on national security and possible data theft, and banned popular short-video platform TikTok and Tencent-owned chat and payments platform WeChat from operating in the United States. However, the bans were quickly overturned by a U.S. court on the grounds that freedom of expression must be protected. In November last year, Trump issued an executive order banning nationals from buying shares of certain Chinese companies. Earlier this month, he ordered that eight Chinese apps not be allowed to be used in transactions.
So far, 35 Chinese companies are on the blacklist, including chipmaker Semiconductor Manufacturing International (SMIC) and China’s largest oil giant PetroChina (CNOOC). Being blacklisted has potentially huge consequences, such as being removed from stock and bond indices. These days, inconsistent signals from the New York Stock Exchange that it is considering removing the 3 major Chinese telecom giants from the list are causing confusion on the stock market.
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