Amid a big week for US-China trade, a new twist.
The United States has put 28 Chinese entities on a blacklist that effectively bars them from importing American technology over the groups’ alleged role in facilitating human rights abuses in China’s Xinjiang region.
“This action will ensure that our technologies, fostered in an environment of individual liberty and free enterprise, are not used to repress defenseless minority populations,” Commerce Secretary Wilbur Ross said in a statement.
The details: The more than two dozen organizations listed include 20 government and security bureaus in Xinjiang, and eight companies, including Hikvision, one of the world’s largest manufacturers of AI-driven video surveillance products, and Meiya Pico, a leading digital forensics firm, per my CNN Business colleague James Griffiths in Hong Kong.
Hikvision — which has previously been accused by US lawmakers of helping China create a “high-tech police state” — suspended trading following the move. Chinese stocks still pushed higher.
In adding the entities to its blacklist, the United States risks complicating the high level trade talks that will take place in Washington later this week. Chinese Vice Premier Liu He arrives on Thursday.
“The move may fuel more tension between the two sides although investors remain hopeful for at least some headway on trade,” ING Asia economist Prakash Sakpal wrote in a research note.
Momentum toward a deal had already been muted. “Can something happen? I guess, maybe,” President Donald Trump told reporters on Monday. “Who knows? But I think it’s probably unlikely. Okay?”
UBS said in a note this week that it expects “only modest progress.” The bank said that given recent weakness in economic data, it will keep recommending that clients keep lower proportions of stocks in their portfolios as trade developments play out.
With expectations low, even a small concession could buoy market sentiment. Lukman Otunuga, senior research analyst at currency broker FXTM, said that an interim deal to halt the increase of tariffs on Chinese goods worth $250 billion, which are set to jump to 30% from 25% on October 15, would be “warmly welcomed by investors across the globe.”
