04/12/2020 14:29 GMT + 7
The administration of US President Donald Trump has added top Chinese chipmaker SMIC to the embargo list.
In addition to SMIC, the US Department of Defense also put three other companies on the embargo list, accusing the Chinese military of owning or controlling these companies. Recently, President Trump signed an executive decree prohibiting US investors from buying securities of blacklisted businesses from November 2021.
The Chinese Embassy in Beijing quoted a spokesman for the Chinese Foreign Ministry “firmly opposed to the politicization of Chinese companies”.
SMIC said it was assessing the impact of being added to the list and warned investors about the risks. SMIC is China’s largest chip maker, heavily dependent on American equipment. SMIC was already stuck in the US-China tensions. In September, the US Department of Commerce announced that a number of companies must apply for a license before providing goods and services to SMIC. The ministry concluded there was an “unacceptable risk” since the device could be used for military purposes.
Before SMIC, some other big Chinese companies such as Hikvision, China Telecom, China Mobile were also added to the list of the US Department of Defense earlier this year.
The US Congress and the Trump administration have stepped up several measures to prevent Chinese companies from complying with regulations to access the US stock market, even if that makes Wall Street unhappy. On December 2, the US House of Representatives passed regulations to “kick” Chinese companies out of the US stock exchange if they do not comply with domestic audit regulations.
Du Lam (According to Reuters)
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