Executive Order to Ban US Investments in Companies Linked to Chinese Military
President Trump on November 12 2020 passed an executive order which looks to prohibit US companies and citizens from buying shares or supporting Chinese companies which are claimed to be linked to the Chinese military (1,2). When does this executive order come into play, and what reasoning does it give?
One of the first and main aspects brought up in the executive order is the idea of China’s Military-Civil Fusion (MCF) development strategy. This strategy looks to develop the People’s Liberation Army (PLA) into a first class military by 2049 by melding the military industry with civilian industry and even stealing international technologies (3). It ensures the PLA access to advanced technologies which may come through avenues such as companies, research programs, and Universities which appear to be civilian entities (4).
US citizens which support or encourage these Chinese enterprises are seen in the White House’s eyes as supporting the PLA either directly or indirectly through financial means, or with US technology. A quote from Mike Pompeo supports the idea, “Even if the Chinese Communist Party gives assurances about your technology being confined to peaceful uses, you should know there is enormous risk to America’s national security.” (5) The executive order being put in place looks to ban and stop this from happening in an attempt to stop China’s theft of technology, and stop the aid of these Chinese companies.
On the 28th of August the Department of Defense released the names of Chinese military companies operating directly or indirectly in the United States.
The main section of the executive order prohibiting the investments doesn’t appear to come into play until the 11th of January 2021 at 9:30am. Will the executive order have the desired effect that President Trump was after? We will have to keep watching the President’s strong anti-China stance.
Direct link to the executive order, https://www.whitehouse.gov/presidential-actions/executive-order-addressing-threat-securities-investments-finance-communist-chinese-military-companies/
-Trent Naz
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Source List -
(1) Chen, S., 2020. Trump Bans Americans From Investing In 31 Companies With Links To Chinese Military. [online] Axios. Available at: <https://www.axios.com/china-military-trump-investments-ban-a0458e29-2245-4bde-920b-d1c6bc698370.html> [Accessed 15 November 2020].
(2) Trump, D., 2020. Executive Order On Addressing The Threat From Securities Investments That Finance Communist Chinese Military Companies | The White House. [online] The White House. Available at: <https://www.whitehouse.gov/presidential-actions/executive-order-addressing-threat-securities-investments-finance-communist-chinese-military-companies/> [Accessed 15 November 2020].
(3) United States Department of State. 2020. The Chinese Communist Party’S Military-Civil Fusion Policy — United States Department Of State. [online] Available at: <https://www.state.gov/military-civil-fusion/> [Accessed 15 November 2020].
(4) U.S. DEPARTMENT OF DEFENSE. 2020. DOD Releases List Of Additional Companies, In Accordance With Section 1237 Of FY99 NDAA. [online] Available at: <https://www.defense.gov/Newsroom/Releases/Release/Article/2328894/dod-releases-list-of-additional-companies-in-accordance-with-section-1237-of-fy/> [Accessed 15 November 2020].
(5) United States Department of State. 2020. The Chinese Communist Party’S Military-Civil Fusion Policy — United States Department Of State. [online] Available at: <https://www.state.gov/military-civil-fusion/> [Accessed 15 November 2020].
(6,7) Can be found https://www.defense.gov/Newsroom/Releases/Release/Article/2328894/dod-releases-list-of-additional-companies-in-accordance-with-section-1237-of-fy/
