The Republican chair of the House of Representatives’ select committee on China said on Wednesday that the panel’s top priority is legislation restricting US investment in China to stop investors from “funding our own demise.”
Number One Priority
“We have to have an outbound investment regime that basically says ‘No investment in these businesses that are on some kind of a list,’ that says ‘We shouldn’t be helping the Chinese military, we shouldn’t be supporting genocide,'” Representative John Moolenaar said, speaking on a panel at the American Enterprise Institute.
“That’s probably our number one priority right now,” he added. “We are actually funding our demise.”
A committee spokesperson confirmed that “genocide” referred to China’s alleged treatment of its Uyghur minority in Xinjiang.
China: ‘US Abusing Power’
The Chinese Embassy in Washington said Beijing firmly opposes “the U.S. overstretching the concept of national security and abusing state power to go after Chinese products and companies.” It added that China would “continue to firmly protect the legitimate and lawful rights and interests of Chinese companies.”
Moolenaar’s remarks signal Congress could revive long-sought restrictions on U.S. investment in China, which have faced a rocky path in Washington.
A provision limiting outbound investment was removed from the Chips Act prior to its enactment in 2022. However, in August 2023, President Joe Biden issued an executive order that empowered the Treasury Department to prohibit or limit U.S. investments in Chinese entities across three key sectors: semiconductors and microelectronics, quantum information technologies, and specific artificial intelligence systems.
But rules implementing that order, proposed in July, have yet to be finalized. The Treasury did not respond to a request for comment on the status of the proposed rules.
Sanctions On China Over Human Rights Abuse In Xinjiang
The United States and other Western countries have imposed sanctions on Chinese officials for human rights abuses in Xinjiang, which the United States has said have amounted to genocide.
China rejects allegations of abuses, including use of forced labour in Xinjiang, and describes the camps it has set up there as vocational training centres for Uyghur Muslims that help combat religious extremism.
Moolenaar also flagged specific Chinese companies that he said pose national security threats including Chinese crane maker Shanghai Zhenhua Heavy Industry Co (ZPMC), which was featured in a recent committee report.
U.S.-bound cranes made by ZPMC, which accounts for 80 percent of ship-to-shore cranes in operation at U.S. ports, contain unauthorized cellular modems, creating a “significant backdoor security vulnerability,” he said.
“ZPMC could disrupt U.S. maritime equipment and technology at the request of the Chinese government, including during a conflict over Taiwan,” he said, referring to the democratically governed island that China claims. The company, he said, is a “loaded gun”.
(With input from Reuters)
