Published: Thu, June 28, 2018
Worldwide | By Stella Potter

China hits back at U.S. investment rules

China hits back at U.S. investment rules

The bill strengthens the Committee on Foreign Investment. "The question was, What were the appropriate tools?"

The administration's move, after weeks of escalating tensions between the world's two largest economies, was likely to be viewed as a conciliatory effort to lessen the risks of a full-blown trade war. The planning to impose tariffs on $34 billion in Chinese goods on July 6, an amount that could reach $450 billion if China refuses to back down and retaliates with sanctions of its own. He has long accused other nations of exploiting poorly negotiated trade deals and of using unfair practices to sell America far more than they buy from it.

"For those who want to say this is being weak on China, the answer is no", Mnuchin told reporters at briefing on the decision.

Mnuchin told reporters the White House expected it would have all the tools it needs once the new law is passed by Congress. "The ball is in their court".

They said they have been working with Congress to pass a bill that will provide "enhancements" to the foreign investment reviews under the Committee on Foreign Investment in the United States.

The inter-agency CFIUS panel, if bolstered by Congress, can address those concerns while maintaining an open investment climate, one of the administration officials said.

"I welcome the president's tough action to prevent any country from stealing our vital technology through investing in or acquiring United States companies", Rep. Kevin Brady, the House Ways and Means Committee chair, said in a statement. It said the specifics of its plan would be officially announced by June 30, which is Saturday.

China's commerce ministry says it objects to the USA using national security as an excuse to tighten the rules for Chinese companies in the US.

The decision marks a victory for Mnuchin in a fierce internal debate within the Trump administration over the scope of China investment restrictions, in which he had clashed earlier this week with White House trade and manufacturing adviser Peter Navarro.

"There's a lot of talent out there, blessedly that would like to come work for me and would like to come work for President Trump", he said.

"We're going to protect it".

"I have no idea whether it will be that high [referring to the Atlanta Fed forecast], but a year ago people were laughing when we talked about 3 percent GDP", he said.

Stock markets surged Wednesday following President TrumpDonald John TrumpCrowley stunner tops huge night for left Trump congratulates Romney on primary win Judge orders Trump admin to begin reuniting immigrant families MORE's decision not to impose new executive restrictions on foreign investments.

Mnuchin and others in the administration argued that employing an improved CFIUS rather than a stricter blanket policy would give the US more flexibility in trade negotiations with China, according to a person familiar with the discussions.

"At the end of the day, all the president's advisers were 100 per cent unanimous when we sat down with the president", Mnuchin said.

The legislation has bipartisan support in both the House and Senate.

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