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Weaponizing of investment policy is not going to 'make America great again': China Daily editorial

chinadaily.com.cn | Updated: 2025-02-23 18:35
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Although the White House claims the so-called National Security Presidential Memorandum signed by US President Donald Trump on Friday is aimed at promoting foreign investment while protecting the United States' national security interests, its true purpose is to direct the Committee on Foreign Investment in the United States to restrict Chinese investments in strategic areas, and to obstruct US investment flowing to key sectors of the Chinese economy.

As the Chinese Ministry of Commerce said in a statement, the "discriminatory" and "unreasonable" move will distort the investment exchanges between the two countries, seriously undermine the confidence of Chinese companies in the US market and cause US companies to cede their Chinese market to other competitors.

The US president's China-targeted investment restrictive measures show that his administration will continue its predecessor's flimflam of saying one thing while doing another in its China policy.

Although the administration has claimed on different occasions that it recognizes the importance of stable and healthy China relations and its willingness to deal with relations from a new beginning, its China policy, on the economic and trade front at least, is just a continuation of that of its predecessor.

US Treasury Secretary Scott Bessent had a video call with Chinese Vice-Premier He Lifeng, who is also Chinese lead person for China-US economic and trade affairs, on Friday. In their discussions on important bilateral economic issues, they agreed to maintain communication on issues of respective concern, implying a willingness to discuss and resolve differences.

Yet the changes the presidential memorandum will introduce to the inspection and review of two-way investment between China and the US are against that common understanding, and are essentially in line with those the former US administration established late last year that became effective on Jan 2, which, in effect closed the door for foreign direct investment between the two sides investing in each other's key technologies, projects and industries. Some China hawks have called that legacy a significant development in US economic statecraft and financial regulation, and predicted that it will open the door to potentially more extensive inbound and outbound investment controls.

The Trump administration is doing nothing but pouring old wine brewed by its predecessor into its new bottle labeled "Make America Great Again". By blindly repeating its predecessor's failed economic policies targeting China, economic and trade relations between China and the US will continue to deteriorate.

According to the Rhodium Group, annual Chinese investment in the US has dropped from $46 billion in 2016 to less than $5 billion in 2022. And the amount of Chinese investment in the US is expected to carry on shrinking after 2022. A similar trend is also observed in the US' investment in China's high-tech fields such as semiconductors, artificial intelligence, quantum communication, biotechnology and aerospace, due to the US administration's restrictions, which has in effect prevented US investors from benefiting from China's technological progress.

If the investment restrictions, along with the additional 10 percent tariff on all Chinese imports, are the US side's tactics to reach what Trump recently said was "a new trade deal" with China that was coming soon, it should be reminded that China will never accept any deal reached through economic coercion or bullying.

The Trump administration's latest steps only serve to threaten to heighten economic tensions with China by making the "fences" its predecessor built around the "small yard" of the US even higher.

The Chinese Commerce Ministry said that China will closely follow the moves of the US and take necessary measures to safeguard its legitimate rights and interests. Instead of trying to bully its way to an advantage by politicizing and weaponizing economic and trade issues, the US administration should talk and work with China to avoid the repetition of a lose-lose situation.

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