Biden issues executive order limiting Chinese investments in US technologies: ‘National security threats’

President Biden is expected to sign a new executive order on Thursday aimed at blocking Chinese investments in U.S. technologies that could be posing “evolving national security risks,” as the authoritarian regime uses covert tactics on industry secrets as part of its “Made in China 2025” plan. 

The executive order aims to evolve the longstanding and previously limited Committee on Foreign Investment in the United States, or CFIUS, which was developed under the Ford administration in 1975, to make improvements to the foreign investment review process and ensure regulations remain “responsive to evolving national security threats,” the White House said in a statement on Thursday. 

For years, the committee’s duties were restricted to preventing foreign acquisitions of American firms that could compromise national security, such as military contractors, but Biden’s order instructs CFIUS to focus on specific types of transactions that could allow foreign adversaries to disrupt the U.S. supply chain, including relationships with suppliers located in allied or partner countries. 

Though China is not referenced directly, the order instructs the committee to review cases impacting “microelectronics, artificial intelligence, biotechnology and biomanufacturing, quantum computing, advanced clean energy, and climate adaptation technologies” – which the New York Times noted are focuses of the “Made in China 2025” industrial plan announced in 2015 by Chinese President Xi Jinping. 

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The authoritarian regime’s economic plan targets 10 high-value industrial sectors for China to obtain global dominance in innovation and manufacturing. Biden’s order identifies those same sectors as “fundamental to U.S. technological leadership and therefore national security.” 

The order instructs CFIUS to assess the risks arising from multiple acquisitions in a single sector, warning that such group investment trends by foreign adversaries, when left unchecked, can “facilitate sensitive technology transfer in key industries or otherwise harm national security.” CFIUS is also to assess cybersecurity risks that threaten to impair national security and to U.S. persons’ sensitive data.

“Today’s Executive Order is a part of the Biden-Harris Administration’s broader strategy to maintain U.S. economic and technological leadership, specifically with respect to protecting national security,” the White House statement said. “This involves both strengthening domestic investments and competitiveness at home and in partnership with our allies while using all available tools to protect America’s edge and prevent our competitors and adversaries from undermining our national security.”