Wednesday, 18 Nov 2020 08:34 AM MYT
The executive order, first reported by Reuters, was signed by Trump on Thursday as he sought to curb access by American investors to 31 Chinese firms labeled by the Pentagon as “owned or controlled” by China's military. It officially goes into effect on January 11. But the directive does not ban new purchases of the securities until November 2021 and allows US investors to continue to own or sell shares they already hold in the targeted companies, raising further questions about its impact.
“Some investors may hold their breath to see whether President-elect Biden will reverse or modify the course of these and other Trump-era China restrictions,” Tuchband added. The directive was part of Trump's efforts to ramp up pressure on China by limiting its access to Wall Street, as relations between Washington and Beijing have soured over issues including the coronavirus pandemic and a Chinese crackdown on Hong Kong. The order was aimed at giving teeth to the Pentagon designations that were mandated by law two decades ago but not disclosed until this past summer.