The White House has decided against proposals to impose harsh restrictions on Chinese investment, reports the Financial Times, opting instead for legislation that would broaden the remit of the government investment security body, Cfius.
The move was welcomed by pro-business parties who feared higher barriers to Chinese investment in America would scare off foreign businesses, but falls short of the tougher stance some members of the administration and congress were hoping for.
One proponent of the legislation and ally of the president, Steven Mnuchin, called the bill a good compromise between protection from risky foreign investment whilst keeping the “strong, open investment environment to which our country is committed.”
Under the new bill, which must be reconciled by Congress, would give Cfius scope to review minority investments in start-ups in key technology industries and real estate purchases.
“One of the problems… before was we could block an acquisition but then a company could go form a joint venture and we couldn’t block that,” said Mnuchin.