China vows countermeasures after US adds biotech to investment curbs
Beijing's commerce ministry objected on Saturday to a US Treasury plan that expands outbound investment restrictions to cover biotechnology alongside AI, quantum and supercomputing, saying it reserves the right to retaliate.
The US Treasury Department put forward the proposal on Thursday, broadening its Outbound Investment Security Program. The existing program already limits American funding into Chinese, Russian and North Korean ventures in hypersonic systems, quantum technology, high-performance computing and artificial intelligence. The new draft would bring biotechnology under the same restrictions, an addition pushed by Treasury Secretary Scott Bessent, who said the change would stop adversaries from using US capital to build technology that threatens national security.
China’s commerce ministry called the expansion discriminatory and accused Washington of overstretching the concept of national security. It said the rule would damage bilateral economic ties and that Beijing would watch developments closely while reserving the right to take unspecified countermeasures.
The proposal still must clear a public comment period before Treasury finalizes it, leaving room for further negotiation but also prolonging uncertainty.
The dispute follows separate US sanctions this week on five Chinese companies tied to former Google engineer Linwei Ding, convicted of stealing artificial intelligence trade secrets, which Beijing also protested.
For markets, the widening US-China investment curbs keep headline risk elevated for Chinese technology and biotech shares, including US-listed ADRs and the Hang Seng Tech index, since biotech has relied heavily on cross-border funding. An escalation in rhetoric or retaliation could also weigh on sentiment toward China-exposed assets and the offshore yuan.
Source: investingLive