Donald Trump has signed an executive order prohibiting US investors from holding shares in companies with suspected ties to the Chinese military, in his first big foreign policy action since losing the presidential election to Joe Biden, reported the Financial Times.
Shares in big Chinese telecoms groups with exposure to US investors tumbled in Hong Kong on Friday, with state-run China Telecom falling as much as 9.3% and rival China Mobile dropping as much as 6.3% following the order.
The measure would prevent US citizens and companies from conducting new transactions in shares of the targeted companies from January 11, nine days before Biden will be inaugurated as the 46th US president. Investors who currently hold shares in the designated companies would have until November 2021 to divest them.
“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 People’s Republic of China intelligence services, which routinely target American citizens and businesses,” said Robert O’Brien, the US national security adviser.