With Washington heading in more hawkish direction, China must respond by opening up state companies to private investment, analysts say
A top US congressional panel has called on Washington to ban Chinese state-owned firms from taking over US companies, citing national security concerns.
The recommendation in a report on Wednesday from the US-China Economic and Security Review Commission comes amid intense speculation about US president-elect Donald Trump’s likely policy on China and fears of a trade rift between the two countries.
Chinese analysts said Washington was almost certain to take a tougher line on Chinese investment and Beijing had to respond by fulfilling promises on ownership reform of state firms.
Zhang Yansheng, a researcher with the National Development and Reform Commission, said similar suggestions had been made in the US before.
“The key is to go through with pledges to reform state firms, to introduce private ownership and diversify equity structure,” Zhang said.
Tsinghua University economics professor Li Daokui said attitudes to Chinese investment in the US would only become more hawkish and this would affect agreements between the world’s two biggest economies.
“The general climate in the US will affect China’s investment in the US, and it will also cast doubt on the bilateral investment treaty talks,” said Li, who is a former adviser to China’s central bank.
Full article: US panel backs takeover ban for Chinese state-owned firms (South China Morning Post)