President Donald Trump signed a bill on Friday that could remove Chinese companies from US stock exchanges if US regulators are unable to review their financial audits. This will further exacerbate tensions between the two countries.
The president has long disagreed with China because of its unfair trade practices and imposing import tariffs that run into the billions. But his rhetoric has escalated this year when he blamed Beijing for the global coronavirus pandemic, a central theme in his defeat of the Joe Biden election, when Trump was widely criticized for handling the outbreak.
Removal of the bill from the list won bilateral support in the House of Representatives earlier this month after a smooth completion of the US Senate in May.
Chinese companies have used US capital markets and dollar-based finance as important financing components to grow their businesses for many years. Although the measure covers an implementation period in which the sanctions were imposed after three consecutive years of non-compliance, they could cause real harm to Chinese companies that do not meet audit standards.
said Louisiana Republican Senator John F. Kennedy, the lead sponsor of the new law,
“The US. The policy allows China to ignore the rules that American companies follow, and that’s dangerous,”
Foreign Ministry spokesman Hua Chuning told reporters in Beijing after the law was passed that China was “against the politicization of securities regulations” and called for cooperation to protect investor rights.
“This will undermine the confidence of global investors in the US capital market and damage the global position of the US capital market and harm US interests,”
Trump’s signing of the bill curbs a recent wave of steps against China, including guidelines limiting travel visas for 92 million Communist Party members. Any of those on a 10 year visa will now see it reduced to one month.