US-China trade war enters Round 2, as Trump plans to curb Chinese investments

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In what could be the second round of trade war with China, US President Donald Trump is planning to restrict Chinese firms from investing in American companies, which will put further pressure on the already tense trade relations.

The US Treasury Department is drafting curbs that would block firms with at least 25% Chinese ownership from buying U.S. companies with “industrially significant technology,” reported Reuters citing a government official briefed on the matter.

Investment restrictions are expected to target key sectors, including several China is trying to develop as part of its “Made in China 2025” industrial plan, the report said.

The plan aims to upgrade China’s capabilities in advanced information technology, aerospace, marine engineering, pharmaceuticals, advanced energy vehicles, robotics and other high-technology industries.

Top facts about Round One of US-China Trade war

  • Tariffs on $34 billion worth of Chinese goods are due to take effect on July 6.
  • The White House on May 29 said the they would press ahead with restrictions on investment by Chinese companies in the United States as well as “enhanced” export controls for goods exported to China, with details to be announced by June 30.
  • It also said it would unveil a revised list of Chinese goods for tariffs, which it did on June 15.

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