WASHINGTON: President Joe Biden is expected to issue his long-awaited executive order to screen outbound investments in sensitive technologies to China early next week, according to people familiar with the matter.

A White House spokesman declined to comment.

The goal of the order is to prevent US capital and expertise from accelerating the development of technologies that would support China’s military modernisation and threaten US national security.

The order is expected to target private equity, venture capital and joint venture investments in China in semi-conductors, quantum computing and artificial intelligence. Most investments captured by the order will require that the government be notified about them.

Some transactions will be prohibited, sources said.

“It fills a gap in our current regime,” said Cordell Hull, a former US Commerce Department official. “We have prohibitions on exporting the technology. We have restrictions on in-bound investment. This will help to plug that gap on funding and know-how and give the government visibility into these capital flows.”

The regulations are not expected to take effect right away and the administration will solicit comment on its proposals, according to sources. It has already conducted meetings with stakeholders and has been consulting allies. It also came up during US Treasury Secretary Janet Yellen’s recent trip to China.

Yellen last month described the potential restrictions as “highly targeted, and clearly directed, narrowly, at a few sectors where we have specific national security concerns”.

Two sources said briefings were expected on Monday, with the announcement the next day. But the timing has slipped many times before and could again.

Published in Dawn, Aug 5th, 2023