China and the United States raised tariff walls insurmountable and they were denied the rare earths and semiconductors that their industries needed months ago. Now they gain weight blacklists with foreign companies, hindering operations in their national markets, but with much less damage than those cannon shots in the rawest part of the trade war. The dynamics establish the certainty that the truce is much less solid than it boasts Donald Trump.
These blacklists have already reached the courts. The technology giant Alibaba has filed a lawsuit in a California court against the US Government for including it in theirs and causing them reputational and economic damage. The Chinese e-commerce leader had already announced weeks ago that he was not ruling out any action to defend himself against what he today described as an “arbitrary, capricious and baseless” decision.
The United States punished Alibaba for her alleged ties to the Popular Liberation Army after defining her as a “military-civilian collaborator of the Chinese defense industry“. The company recalled today that its board of directors is independent, that all have no military affiliation and that its corporate purpose includes sales, logistics and information technology. “Neither weapons, nor defense nor intelligence,” it stated in a lawsuit that also names the Secretary of War as a defendant, Pete Hegseth.
“Threat to US security”
Alibaba maintains that the measure has already caused it a “irreparable damage“. “For many American businesses, Alibaba is the main gateway to the Chinese market. Labeling it as a Chinese military company is equivalent to labeling it as a Chinese Army instrument and one threat to national security of the United States.” And that, he reasons, directly attacks his reputation and “casts doubt on any commercial relationship that our company maintains with the United States.”
Beyond its good name, Alibaba is concerned about its bottom line. The measure does not contemplate fines or the freezing of assets, but it ties up its commercial activity. US law prohibits the Pentagon from closing any deals with the companies included on the list starting this month and from purchasing their products and services through third parties starting in 2027. Even more relevant: the ban covers all US contractors who share pressure groups o law firms with the indicated companies. Alibaba faces the risk of functional blockage if it loses the network of advisors and advisors it has worked with for years.
Trump has fattened the list of Chinese companies penalized for their alleged military ties. It was established in 2021 and in the last year it has grown from 134 to 188. The last update, two weeks ago, was public: they were there too BYDthe largest electric car manufacturer in the world, and Baidusearch leader in China. Tencentowner of the messaging platform Wechatwas already noted last year. The criterion seems already consolidated: any major Chinese technology company contributes to the development of the People’s Liberation Army.
After the Trump-Xi summit
The move surprised China. Not because it is unprecedented: the Chinese complaint about the American pretext of national security to intimidate its technology companies is old. It was timing: just weeks after Trump and Xi Jinping extended in Beijing the truce they had sealed last year in South Korea after months of fierce trade battles. Beijing accused Washington of threatening global supply chains and “breaking the consensus” reached. From that summit, described with much more enthusiasm by the White House than by China, came trade agreementsbut it did not stop the friction over technological exports or Taiwan. Trump announced days later that he would speak with the Taiwanese president, an anathema to Beijing.
The Chinese counterattack was taken for granted, the only thing left to know was the date and magnitude. It arrived this week and affected 46 US companies linked to sectors such as defense, drones, aerospace technology and rare earths. The public administration will not be able to buy its assets, according to the new law. It also includes ten other companies on the export control list. “A firm and forceful response,” justified Beijing, against the American affront. The Chinese press these days emphasizes the differences. On the one hand, someindiscriminate and arbitrary sanctions“, with no other plan than to stop Chinese technological development; on the other, justified and surgical ones, applied only against companies with proven links to the US military industry.
Subscribe to continue reading
