US Firms Say China Has Become ‘Uninvestable,’ Commerce Secretary Says

Tom Ozimek
By Tom Ozimek
August 30, 2023Business News

U.S. Commerce Secretary Gina Raimondo said Tuesday that American companies have complained to her that China has become “uninvestable” as the level of risk associated with doing business there has spiked amid factors such as changes to counterespionage laws and raids on foreign firms.

Secretary Raimondo made the remarks while on a train heading from Beijing to Shanghai on Aug. 29 during an official visit to China.

“Increasingly I hear from American business that China is uninvestible because it’s become too risky,” Ms. Raimondo said.

The commerce secretary is in China to bolster economic ties amid concerns that political tensions between the two countries could deteriorate further and lead to open hostilities.

‘Raids on Businesses’

U.S. companies doing business in China face a host of new challenges, Ms. Raimondo said, including “exorbitant fines without any explanation” and “revisions to the counterespionage law, which are unclear and sending shockwaves through the U.S. community.”

The commerce secretary added that “raids on businesses” were among the issues facing American firms in China, with the problems collectively representing “a whole new level of challenge” that needs to be addressed.

One example of seemingly arbitrary crackdowns U.S. companies face in China was a recent ban by Beijing of American chipmaker Micron Technology semiconductor sales to key Chinese domestic industries.

Ms. Raimondo cited the Micron ban in her remarks to reporters, saying there had been no explanation given for it and the restrictions came about amid “limited due process.”

The Chinese embassy in Washington did not immediately respond to a request for comment on the commerce secretary’s remarks.

Ms. Raimondo’s statements make clear that commerce is a key area of friction between China and the United States, including tit-for-tat export controls.

Bilateral ties between Beijing and Washington have deteriorated this year over a range of issues, including aggressive Chinese military posturing around Taiwan and allegations of spying.

In April, Washington announced new restrictions on exports to China to keep semiconductor and other technology away from Beijing’s military. China later announced export controls on two strategic metals, a move widely interpreted as retaliatory.

In an apparent bid to mend frayed ties, Ms. Raimondo told reporters at a press conference in Beijing that the United States and China have agreed to set up a working group on trade and investment issues, including export controls.

The decision to set up the working group was met with a critical response from House Foreign Affairs Committee Chairman Rep. Michael McCaul (R-Texas), who called it “dangerous.”

“The Biden administration’s decision to join forces with the Chinese Communist Party to establish a working group on export controls and commercial issues with CCP officials is at best naive, but also dangerous,” Mr. McCaul said in a statement.

“The CCP steals U.S. intellectual property and hacks the emails of senior government officials—including Secretary Raimondo. The administration must stop treating the CCP as anything other than an adversary who will stop at nothing to harm our national security and spread its malign authoritarianism around the globe.”

Michael Hart, the president of the American Chamber of Commerce in China, was asked about Mr. McCaul’s remarks during an interview on CNBC.

Downplaying Mr. McCaul’s remarks as a “political take on the issue,” Mr. Hart said that from the perspective of the American Chamber of Commerce, “there is nothing more important than continued trade,” adding that a number of U.S. businesses have told him that China remains an important market for them.

Commenting on Ms. Raimondo’s visit, Mr. Hart said she has both “the carrot and the stick” as she’s in charge of both trade and export controls, “so the Chinese really want to talk to her.”


Ms. Raimondo is the fourth senior U.S. official to travel to China in 10 weeks.

On Tuesday, she met several high-ranking Chinese officials before talking to Premier Li Qiang and delivering a message about the Biden administration not wanting to break trade ties.

“I have had a very productive visit so far,” Ms. Raimondo told Mr. Li ahead of closed-door sessions. “President Biden asked me to come here to convey a message that we do not seek to decouple; we seek to maintain our $700 billion commercial relationship with China.”

Mr. Li highlighted that economic and trade relations are crucial for the stability of the U.S.–China ties. But he hopes Washington “can work in the same direction with China” and develop the bilateral ties with “more sincerity and concrete actions.”

Earlier on Tuesday, Ms. Raimondo also sat down with Vice Premier He Lifeng, Chinese leader Xi Jinping’s close ally who oversees the country’s economy.

“While we will never compromise in protecting our national security, I want to be clear that we will never seek to decouple or hold China’s economy back,” Ms. Raimondo said at the start of the meeting.

Mr. He raised concerns about the U.S. tariffs, export controls, and investment restrictions, according to the readout from China’s Ministry of Commerce.

Separately, senior officials from Beijing and Washington were scheduled to have the first “information exchange” on export controls on Tuesday.

President Joe Biden signed an executive order earlier this month to restrict investment in China’s sensitive technologies, including quantum computing, artificial intelligence, and semiconductors sectors.

The move followed a sweeping semiconductor export controls on China unveiled by President Biden last October.

The Chinese regime has tightened its own export controls. Starting from Aug. 1, gallium and germanium—two rare metals critical to the manufacturing of semiconductors—are subject to export restrictions, the Ministry of Commerce announced in July, citing the need to protect national security.

Dorothy Li and Reuters contributed to this report.

From The Epoch Times

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