President Joe Biden has enacted an executive order constraining U.S. investment in particular Chinese technology companies. The directive is designed to tackle the national security threats linked to companies involved with “sensitive technologies” like semiconductors, quantum computing, and AI.
According to the executive order, the rise in these cutting-edge technologies could foster the growth of advanced computational abilities, leading to new applications with substantial national security implications. These applications might include the creation of more complex weapons systems, cryptographic code-breaking, and other advancements that could offer military benefits to these nations.
Characterized by the White House as a “carefully focused” measure, the executive order is intended to prohibit financing for firms engaged in particular activities connected to the aforementioned technological domains that are viewed as presenting the gravest national security dangers. The Treasury Secretary will be tasked with overseeing the enforcement of this order, as reported by The Washington Post.
Scheduled to become effective in 2024, this executive order is not an isolated incident in U.S. efforts to curtail the sway of Chinese tech companies. Both Biden and his predecessor have placed significant limitations on companies like Huawei in the past. Moreover, the White House has restricted the sale of supercomputing technology to Chinese entities and has worked to hinder China’s access to advanced chip-manufacturing tools. Additionally, the Biden Administration has urged ByteDance, the Chinese proprietor of TikTok, to divest the widely-used app.
Frequently Asked Questions (FAQs) about executive order
What is the purpose of President Biden’s executive order regarding Chinese tech firms?
The executive order aims to place new limits on American investment in certain types of Chinese tech firms that deal with “sensitive technologies,” such as semiconductors, quantum computing, and AI. This is to address national security concerns that include the development of sophisticated weapons systems, cryptographic code-breaking, and other applications that could provide military advantages.
When will the executive order go into effect?
The executive order will not go into effect until 2024.
Who is responsible for enforcing the executive order?
Responsibility for enforcing the executive order will fall on the Treasury Secretary, as mentioned in the text.
Has the U.S. government taken similar actions before?
Yes, both President Biden and his predecessor have imposed significant restrictions on Chinese tech companies, such as Huawei. The White House has also limited the sale of supercomputing technology to Chinese firms, sought to block China’s access to advanced chip-making equipment, and pressured ByteDance, the Chinese owner of TikTok, to sell the app.
Is the executive order broadly targeted or narrowly focused?
The White House described the move as “narrowly targeted,” meaning it is meant to bar the funding of entities that engage in specific activities related to the technology areas that pose the most acute national security risks.