China announced on May 20 that it will impose sanctions on three US defense companies due to their arms sales to Taiwan, coinciding with the inauguration of the self-ruled island's new president.
The Commerce Ministry of China has announced that several US companies, including General Atomics Aeronautical Systems, General Dynamics Land Systems, and Boeing Defense, Space and Security, will be included in Beijing's list of "unreliable entities."
China Sanctions US Defense Contractors
The list aims to hold accountable companies, groups, or individuals who pose a threat to national security. Various consequences may arise, such as limitations on trade, investment, and visas, according to Bloomberg.
Meanwhile, Lai Ching-te has expressed his commitment to maintaining strong relations with the United States, both in terms of military cooperation and other areas, similar to his predecessor, Tsai Ing-wen. China has expressed its determination to assert control over Taiwan in the future, even if it means resorting to force.
China retaliates against the US with sanctions on Lockheed and RaytheonIn early 2023, Lockheed Martin Corp. and a subsidiary of Raytheon Technologies Corp. were added to the list, and now three more companies have joined them.
The impact of the move is expected to be minimal for the companies involved, as US defense companies typically do not engage in business activities in China.
In April, China imposed a freeze on the assets of General Atomics Aeronautical Systems and General Dynamics Land Systems that were being held within its borders.
According to corporate filings, General Dynamics has established several Gulfstream and jet aviation services operations in China. Despite China's efforts to develop its own aerospace technology, it still heavily depends on foreign companies like General Dynamics.
China Sanctioned Boeing Defense CEO in 2022
The company also assists in the production of the Abrams tank, which Taiwan is acquiring to modernize its armored forces in order to enhance its defense capabilities.
General Atomics is known for manufacturing the Predator and Reaper drones that are utilized by the US military. However, it remains uncertain whether the company supplies any weapons to Taiwan.
In 2022, China imposed sanctions on Ted Colbert, the president and CEO of Boeing Defense, Space and Security, following the company's successful bid to supply Harpoon missiles to Taiwan, worth $355 million.
Taiwan has been experiencing a rise in military provocations from China's People Liberation Army, with frequent flybys of fighter jets and the presence of warships near the island, as per AP News.
The potential consequences of the sanctions imposed by Beijing on companies like Boeing remain uncertain. Most sales of weapons-related technology to China are prohibited by the United States, although there are military contractors who also have civilian businesses in aerospace and other industries.
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