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15:37, 14-Sep-2017
Commerce Ministry: Foreign deal reviews should not be a cover for protectionism
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China’s Ministry of Commerce (MoC) said on Thursday that conducting security checks on foreign investments in sensitive sectors is a nation’s legitimate right, but it should not be used as a tool for protectionism. The comments came after US President Donald Trump blocked a Chinese firm from buying an American chipmaker.
Trump on Wednesday blocked attempts by Canyon Bridge Fund to acquire Lattice Semiconductor Corporation, claiming the deal posed a threat to US national security.
Trump personally intervened in the process after the companies appealed to him directly to overrule the ruling of the Committee on Foreign Investments in the United States (CFIUS), according to The Wall Street Journal.
CFIUS is the core reviewing body for such sales in the United States, and makes recommendations to the president.
Chinese Ministry of Commerce spokesperson Gao Feng speaks at a press briefing on September 14, 2017 in Beijing. /MOFCOM Photo
Chinese Ministry of Commerce spokesperson Gao Feng speaks at a press briefing on September 14, 2017 in Beijing. /MOFCOM Photo
MoC spokesperson Gao Feng, speaking at a press briefing on Thursday, said the US should evaluate the acquisition objectively and create a fair and transparent business environment for foreign investment.
Trump's move marks only the fourth time in the past 27 years that a US president has ordered a halt to a foreign takeover of a US firm on national security grounds.
Portland-based Lattice makes chips known as field-programmable gate arrays, which allow companies to put their own software on silicon chips for different uses.
Trump said in an executive order that Canyon Bridge and Lattice “shall take all steps necessary to fully and permanently abandon the proposed transaction” within 30 days.
US President Donald Trump departs the White House for Camp David September 8, 2017 in Washington, D.C. /VCG Photo
US President Donald Trump departs the White House for Camp David September 8, 2017 in Washington, D.C. /VCG Photo
Canyon Bridge said in a statement that it was disappointed in Trump's decision to "forgo what we believe to be an excellent deal for Lattice's shareholders and its employees by expanding the opportunity to keep jobs in America."
The Trump administration has adopted an aggressive stance towards China on trade — launching investigations into Chinese trade practices under the 1974 Trade Act's section 301 and China-imported aluminum and steel.
According to a report published by the National Committee on United States-China Relations and the Rhodium Group, Chinese enterprises invested 45.6 billion US dollars in the US in 2016, a 200 percent increase from the previous record set in 2015.
By the end of 2016, the accumulative total of Chinese foreign direct investment in the US reached around 109 billion US dollars, creating over 140,000 jobs in the US.
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