US President Donald Trump speaks during a lunch meeting with Republican members of Congress at the White House in Washington. — Reuters photo
WASHINGTON: President Donald Trump on Tuesday endorsed US Treasury Secretary Steven Mnuchin’s measured approach to restricting Chinese investments in US technology companies, saying a strengthened merger security review committee could protect sensitive American technologies.
Trump, in remarks to reporters at the White House, said the approach would target all countries, not just China, echoing comments from Mnuchin on Monday amid a fierce internal debate over the scope of investment restrictions due to be unveiled on Friday.
“It’s not just Chinese” investment, Trump told reporters when asked about the administration’s plans.
Mnuchin and White House trade adviser Peter Navarro sent mixed signals on Monday about the Chinese investment restrictions, ordered by Trump on May 29. Mnuchin said they would apply to “all countries that are trying to steal our technology,” while Navarro said they would be focused specifically on China.
The restrictions are being developed to help put pressure on China to address the administration’s complaints that it has misappropriated US intellectual property through joint-venture requirements, unfair licensing policies and state-backed acquisitions of US technology firms.
Mnuchin would prefer to use new tools associated with pending legislation to enhance security reviews of transactions by the Committee on Foreign Investments in the United States (CFIUS), some administration officials have said.
A government official told Reuters on Sunday that Treasury had been working on a proposal to ban acquisitions of US firms with “industrially significant technology” by companies with at least 25 per cent Chinese ownership.
Asked about the pending restrictions at a White House meeting with Republican lawmakers on Tuesday, Trump said: “We have the greatest technology in the world. People copy it. And they steal it, but we have the great scientists, we have the great brains and we have to protect that and we’re going to protect it and that’s what we’re doing.
“And that can be done through CFIUS. We have a lot of things we can do it through and we’re working that out,” he said.
Prior to the meeting, Mnuchin was seen by reporters in the West Wing of the White House. A Treasury spokesman did not respond to a Reuters request for comment.
The US House of Representatives passed legislation on Tuesday to strengthen the authority of CFIUS by a 400-2 vote, with many similarities to a Senate-passed bill. Both versions would expand CFIUS reviews to minority stakes in US companies and investments that may reveal information on critical infrastructure to foreign governments.
Trump’s intensifying list of trade disputes with China, the European Union, Canada and Mexico showed signs of influencing Federal Reserve policy on Tuesday. Atlanta Fed President Raphael Bostic said in Birmingham, Alabama, that increased tensions could cause him to oppose a fourth rate increase this year.
Trump said earlier on Twitter that his administration was “finishing up” its study of tariffs on US car imports, suggesting that he would take action soon. — Reuters