The US Treasury department is attempting to water down an executive order from President Donald Trump that bars Americans from investing in Chinese companies with suspected ties to the People’s Liberation Army, reported the Financial Times.
The effort has been met with furious opposition from the Pentagon and state department, opening up a heated dispute over one of the last big anti-Beijing policies of the Trump era.
The effort is part of a broad push to counter China’s “military-civil fusion” strategy which compels Chinese companies to share technology with the PLA. The Trump administration argues that the strategy means US investors who invest in Chinese companies are helping Beijing and damaging America’s national security.
Three people familiar with the debate said Treasury wanted to exclude Chinese subsidiaries from the ban, but that the effort is being fiercely resisted by the state department and Pentagon, which have argued that not including them would significantly weaken the overall impact of Trump’s order, reported the FT.