Get 40% Off
👀 👁 🧿 All eyes on Biogen, up +4,56% after posting earnings. Our AI picked it in March 2024.
Which stocks will surge next?
Unlock AI-picked Stocks

U.S. curbs Chinese drone maker DJI, other firms it accuses of aiding rights abuses

Published 12/16/2021, 09:04 AM
Updated 12/17/2021, 09:07 AM
© Reuters. FILE PHOTO: A man wearing a face mask following the coronavirus disease (COVID-19) outbreak is seen at a counter displaying drones and other products, at DJI's flagship store in Shenzhen, Guangdong province, China August 8, 2020. REUTERS/David Kirton/File Photo

By Alexandra Alper and Daphne Psaledakis

WASHINGTON (Reuters) - The U.S. government put investment and export restrictions on dozens of Chinese companies on Thursday, including top drone maker DJI, accusing them of complicity in the oppression of China's Uyghur minority or helping the military, further ratcheting up tensions between the world's top two economies.

Blaming DJI and seven other tech firms for supporting "the biometric surveillance and tracking" of Uyghurs, the U.S. Treasury Department added them to a list of entities suspected of having Chinese military links, barring Americans from trading in their securities.

Separately, the Commerce Department added China's Academy of Military Medical Sciences and its 11 research institutes to a trade blacklist, restricting access to U.S. exports.

It said the academy uses biotechnology for military uses, including "purported brain-control weaponry", without defining the technology further.

The term was used by the academy's president in a 2015 Chinese military newspaper article outlining future warfare, to describe "equipment that interferes with and controls human consciousness" during combat.

Reuters recently reported that a four year project by the academy's head of brain science included China's biggest gene firm BGI conducting genetic research on military recruits at high altitude in Tibet. Two BGI Group subsidiaries were put on the trade blacklist last year.

The department also added HMN International, formerly Huawei Marine, Jiangsu Hengtong Marine Cable Systems, Jiangsu Hengtong OpticElectric, Shanghai Aoshi Control Technology Co, Ltd, and Zhongtian Technology Submarine Cable to the list over U.S. allegations of acquiring, or attempting to acquire, technology from the United States to help modernize the People's Liberation Army.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

The Chinese embassy in Washington called the actions "unwarranted suppression" that violated free trade rules, adding that Beijing would take "all essential measures" to uphold the interests of Chinese companies and research institutions.

"China's development of biotechnology has always been for the well-being of mankind. The relevant claims of the U.S. side are totally groundless," embassy spokesman Liu Pengyu said in an email.

Chinese foreign ministry spokesman Wang Wenbin told a regular briefing on Friday that China firmly opposes the latest U.S. moves and urged the U.S. to "rectify" its "mistaken ways".

Echoing these remarks, China's commerce ministry described the U.S. actions as "bullying" and said they were not conducive to the recovery of the global economy.

It added in a statement that in the absence of any factual basis for the measures, Washington has "fabricated reasons out of thin air".

A DJI spokesperson declined to comment on the U.S. announcement on Friday, but directed Reuters to the company's statement when the U.S. Commerce Department put it on the so-called entity list a year ago for the same reasons. That step barred it from buying or using U.S. technology or components.

At the time, DJI said it had done nothing to justify the move and would continue to sell products in the United States.

U.N. experts and rights groups estimate that more than a million people, mainly Uyghurs and members of other Muslim minorities, have been detained in recent years in a vast system of camps in China's far-west region of Xinjiang.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

China denies rights abuses in Xinjiang and has pushed back against U.S. "interference" in its affairs, vowing to protect its companies against U.S. sanctions.

Commerce Secretary Gina Raimondo said China is choosing to use biotechnologies "to pursue control over its people and its repression of members of ethnic and religious minority groups."

"We cannot allow U.S. commodities, technologies, and software that support medical science and biotechnical innovation to be diverted toward uses contrary to U.S. national security," she said in a statement.

Thursday's announcement coupled with last week's investment ban on Chinese facial recognition company SenseTime could worsen already rocky relations between Beijing and Washington, despite President Joe Biden’s trying in a November virtual meeting with China’s leader Xi Jinping to establish “guardrails” to prevent the two superpowers from sliding toward conflict.

Also on Thursday, the Senate passed the Uyghur Forced Labor Prevention Act. Biden has said he will sign it into law. The bill would ban imports from China's Xinjiang region over concerns about forced labor.

SURVEILLANCE TECHNOLOGY

The investment ban, which will also apply to Megvii Technology Limited and Cloudwalk Technology Co Ltd, was first imposed by Donald Trump's administration and revised by Biden. It prohibits U.S. entities from investing in dozens of Chinese companies with alleged ties to the defense or surveillance technology sectors. It now spans dozens of companies, from China's top chipmaker SMIC to oil producer CNOOC (NYSE:CEO).

All eight companies added to the list on Thursday are already on the entity list. The list has become a go-to tool for Washington in the U.S.-China tech feud. Suppliers to companies on the list must seek a special license from the Commerce Department to ship goods to the targeted company. The license requests face a tough standard of review.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Cloudwalk and Megvii both said in separate statements they opposed the U.S. Treasury's decision, with Megvii adding that its inclusion on the list would not impact the company's daily operations.

Beijing and Washington have clashed over several issues, including U.S. criticism of China’s expanding nuclear arsenal and the Biden administration’s decision this month for U.S. government officials to boycott the 2022 Beijing Winter Olympics over rights abuses.

China’s telecommunications equipment company Huawei Technologies was added to the entity list in 2019. Submarine cable maker HMN Technologies was added later that year.

Washington has become increasingly concerned about security threats posed by the company's role in building undersea internet cables, which have far greater data capacity than satellites. Last year, it sent warnings to Pacific Island nations about HMN's bid to participate in a project to improve communications in the region, Reuters reported.

Beijing says it has no intention of using cable infrastructure for spying.

Latest comments

China needs to step in and stop America from oppression of its minorities and native Asian population. l the land had been stolen from the Asians throughout all of the Pacific and the Americas since Italian Columbus came on board. China needs to enact laws that will punish Americans and, as last resort, send them back to their motherland. Enough is enough.
Spoken like a good little commie! Bravo Comrade, your indoctrination is complete.
China has been handing us our lunch for years, and now these superfluous jabs because of human rights will amount to NOTHING. Just like taking a knee at the football game. No quantitative substance. Try reestablishing self reliance as a nation.
We need to teach China a lesson, fast and hard.
Genius like you seated in DC made us paid more.
yes, China should know better, everyone knows that drones are not made for "biometric surveillance and tracking" of minorities, they are made to drop bomb on Afgan wedding parties
for one we can recognize Taiwan as Country on its own , two move nuclear war heads in taiwan , three step in on so called south china sea and have permanent nuclear capabilities there . China is a threat number one to the world. Deal with them in asia now or later on our shores . CCP is a disease . Uncurable one
Very soon China will kick ford and Tesla out of china
they should kick gm out.
No, China will welcome more US companies, why cut yourself like US?
About time US get tougher against CCP!
 -- Agreed
They keep recycling this week old story, incredible.
The USA has over 1 million prisoners, mostly black and hispanic...
which statically have higher crime rate pre person, fact!!! Robbing someone and only getting 20-50 dollars doesn't make it less of a crime!!!!
Racism
Whats your point ? How many politicals one ? Zero with capital Z. USA should have at least few hundred thousands more ( esp on blue states where crime is exploding )What % is the asian population in usa behind bars ? Or tou are going to tell us that asian in usa get a prefered treatment ? So dont feed us some bs here . You do the crime get ready to do the time . “ Black males had the highest homi- cide rate (72 per 100,000 population), followed by black females (14 per 100,000), white males (9 per 100,000), and white females (3 per 100,000).” This was from USA department of justice report
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.