World News

Trump Bans Americans From Investing In Cos. Controlled By Chinese Military

The U.S. Government prohibited American firms and citizens from investing in a set of listed Chinese companies linked to its military.

An Executive Order that President Donald Trump signed Thursday prohibits U.S. investors from buying the securities of these companies from January 11, 2021.

Disinvestment transactions made in order to divest ownership in these companies will be permitted until November 11, 2021.

The 31 companies designated by the Department of Defense in June and August includes telecom giant Huawei and video surveillance equipment manufacturer Hikvision.

Blacklisted companies such as China Telecom and China Mobile trade on the New York Stock Exchange.

The presidential order is aimed to protect American investors from funding Communist Chinese military companies, the White House said.

“The President’s action serves to protect American investors from unintentionally providing capital that goes to enhancing the capabilities of the People’s Liberation Army and the intelligence services of the Chinese Government”, according to it.

Washington alleges Beijing and PLA of routinely targeting American citizens and businesses through cyber operations, and threatening the critical infrastructure, economy, and military of the United States and its allies.

According to the Executive Order, the Chinese Government exploits U.S. investors to finance the development and modernization of its military.

Many of these companies are publicly traded on stock exchanges around the world, and individual investors in the United States can unknowingly provide funds to them through passive institutional investment vehicles such as mutual funds and retirement plans, National Security Advisor Robert C. O’Brien said in a statement.

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