China added MP Materials and USA Rare Earth, as well as eight other American companies it says are linked to the U.S. military, to its list of companies under export controls in response to Washington's imposition this month of restrictions on a number of Chinese companies, UNN reports citing Reuters.
Details
Aveox, a manufacturer of electric motors for critical applications, was also added to the list, which bans Chinese exports of dual-use goods to these companies.
Pentagon-backed MP Materials, which operates the only active rare earth mine in the United States, and USA Rare Earth are involved in the "mine-to-magnet" supply chain.
These measures are a response to the "malicious practices of the U.S. government" and were taken to protect national security and interests, as well as to fulfill international obligations such as non-proliferation, according to a statement from China's Ministry of Commerce published on Monday.
"Organizations and individuals in any country or region are prohibited from transferring or supplying dual-use goods produced in China to these organizations," the statement said, adding that export activities must be immediately terminated.
This move effectively means a complete ban on the export of dual-use goods to the listed companies, tightening rules that previously only required export licenses.
However, analysts said China's actions are largely symbolic in response to the 1260H list published by the Pentagon, which includes Chinese technology companies that the Pentagon believes are providing support to the Chinese military. The list was updated this month to include e-commerce giant Alibaba, internet search company Baidu, and automakers BYD and NIO.
"Most of the companies are U.S. defense industry players or have close ties to the U.S. government... These companies are not going to do business in China, so the impact will be quite symbolic," said George Chen, Greater China partner at geopolitical consulting firm Asia Group.
"Beijing's move today is a proportionate response to the (U.S.) Department of Defense's 1260H list," he added.
In a separate notice, China's Ministry of Finance said it had decided to take measures against 46 American companies. Chinese buyers are now prohibited from purchasing any products they manufacture, although U.S.-funded enterprises operating in China can still do so.
China arrests US citizen on suspicion of espionage12.06.26, 10:51