Trump said he would issue a proclamation today “to better secure our nation’s vital university research, and to suspend the entry of certain foreign nationals from China, who we have identified as potential security risks.”
The action was announced in a wide-ranging speech signaling toughening U.S. action to counter threats posed by the Chinese regime in the United States and in Hong Kong. It also comes amid repeated criticism by the United States of Beijing’s mishandling of the CCP virus outbreak, which caused the global pandemic.
The move blocks entry to certain graduate level and above Chinese nationals who are associated with entities that support China’s military-civil Fusion strategy, according to a White House statement. This state strategy advocates leveraging private industry and universities to advance the regime’s military.
“For years, the government of China has conducted illicit espionage to steal our industrial secrets, of which there are many,” Trump said.
Under the U.S. Department of Justice’s “China initiative,” prosecutors have charged Chinese and American researchers and academics in a spate of China-related economic espionage cases.
There are approximately 370,000 Chinese students studying in the United States, according to statistics compiled by the nonprofit Institute of International Education and the U.S. State Department.
Chinese Companies on US Exchanges
In a separate measure, the president announced that he is ordering a review of Chinese companies listed on U.S. exchanges.
The review by the administration’s working group on financial markets would look at the “differing practices of Chinese companies listed on the U.S. financial markets, with the goal of protecting American investors,” Trump said.
“Investment firms should not be subjecting their clients to the hidden and undue risks associated with financing Chinese companies that do not play by the same rules,” he added.
Currently, the Chinese regime currently blocks U.S. regulators from inspecting full audit reports of publicly traded companies headquartered in mainland China and Hong Kong, citing national security and state secrecy. Critics have repeatedly pointed to this lack of transparency as posing material risks to American investors.
“Americans are entitled to fairness and transparency,” Trump said.
Last week, Nasdaq informed Luckin Coffee it plans to delist the company, a month after the Chinese beverage brand admitted that its chief operating officer had falsified 2019 sales by about $310 million. In January, short-seller Muddy Waters Research said it would bet against the stock, based on a report that the company was committing fraud.
Chinese video streaming site iQiyi was also accused in April by Wolfpack Research, an activist financial research firm, of overstating its revenues in 2019 by as much as $1.9 billion.
There are 172 Chinese companies listed on U.S. exchanges valued at more than $1 trillion as of September last year, according to the U.S.-China Economic and Security Review Commission annual report. These include Alibaba Group, Baidu, and JD.com.