The US government has removed Chinese smartphone producer Xiaomi and China’s third-largest national oil company for alleged military links, heaping pressure on Beijing in President Donald Trump’s last week in office.
The Department of Defense added nine companies to its list of Chinese companies with military links, including Xiaomi and state-owned plane manufacturer Commercial Aircraft of China (Comac).
US investors will have to divest their stakes in Chinese companies on the military list by November this year, according to an executive order signed by Trump in November.
Gartner data says that Xiaomi overtake Apple as the world’s No. 3 smartphone maker by sales in the third quarter of 2020.
Xiaomi’s market share has grown as Huawei’s sales have suffered after it was blacklisted by the US and its smartphones were cut off from essential services from Google.
The Commerce Department put China National Offshore Oil Corp. (CNOOC) on the entity list, an economic blacklist that forbids US firms from exporting or transferring technology with the companies named unless permission has been obtained from the US government. The move comes after about 60 Chinese companies were added to the list in December, including drone maker DJI and semiconductor firm SMIC.
“China’s reckless and belligerent actions in the South China Sea and its aggressive push to acquire sensitive intellectual property and technology for its militarisation efforts are a threat to US national security and the security of the international community,” US Commerce Secretary Wilbur Ross said in a statement.
“CNOOC acts as a bully for the People’s Liberation Army to intimidate China’s neighbours, and the Chinese military continues to benefit from government civil-military fusion policies for malign purposes,” Ross said.
Chinese state-owned company Skyrizon was also added to the economic blacklist, for its push to “acquire and indigenise foreign military technologies,” Ross said.