1

Based on https://www.nytimes.com/2022/09/15/us/politics/biden-china-tech-executive-order.html

President Biden signed an executive order on Thursday designed to sharpen the federal government’s powers to block Chinese investment in technology in the United States and limit its access to private data on citizens, in a move that is bound to heighten tensions with Beijing.

The first couple of items look reasonable, but I am very puzzled why they want to ban "advanced clean energy and climate adaptation technologies"?

The new order directs CFIUS to concentrate on specific types of transactions that would give a foreign power access to technologies that Mr. Biden has identified as critical to American economic growth. That includes “microelectronics, artificial intelligence, biotechnology and biomanufacturing, quantum computing, advanced clean energy and climate adaptation technologies,” according to a White House summary.

Can anyone explain how China's investment in US companies "advanced clean energy and climate adaptation technologies" could threaten the national security of U.S.?

2
  • I've copyedited at bit (there were quote marks missing). Also the article makes it clear it's not a total ban, but directs CFIUS to scrutinize such acquisitions more closely. For those who don't like the NYT paywall, there's a WH presser too whitehouse.gov/briefing-room/statements-releases/2022/09/15/…
    – Fizz
    Sep 16 at 7:34
  • You shall ask why the Chinese want to invest in a foreign country in the first place, especially the countries in the west block.
    – r13
    Sep 16 at 20:00

2 Answers 2

4

I think the answer by user366312 is somewhat correct, but ultimately wrong in its final conclusion with respect to what the goal is. It's probably not so much about denying China the green tech (and certainly not indefinitely), but preventing some potentially critical innovation/patents acquired by a foreign power disrupting the US market. It's indeed possible to force-license patents and so forth, but as we saw with Covid vaccines, advanced countries would rather not take that kind of risks. See how the EU/Germany blocked Trump's alleged attempts to buy some German vaccine company or at least its output.

Moreso because acquiring a company can also disrupt or kill it. It's not too uncommon for a start-up to be acquired just to make its products go away, for the benefit of a (typically larger) competitor or even just would-be competitor.

Yes, the US also has export controls on a bunch of techs to China, which certainly include advanced computing tech, but I'm not sure they're denying green tech exports to China unless they're likely dual use like some type of battery tech that can also be used on submarines etc. There is a (somewhat dated) BIS analysis, which goes into some detail what kind of green tech required export licenses; it seems that was mostly where it overlapped with electronics, e.g. "The export of Metal-Organic Chemical Vapor Deposition (MOCVD) equipment requires an export license for most destinations, and is used to produce the solar cells used in solar panels and LED lighting products." but also some machining tools for carbon fibre for instance. (A bit more googling finds that MOCVD equipment can also be used to make rad-hard electronics.) However, overall, "Of the $1,300.5 billion in total U.S. exports in 2008, BIS identified 5.8% ($75.0 billion) as green technology-related exports, and only 0.9% ($697.4million) of these required an export license."

(Speaking of rad-hard, Russian companies acting as angel customer (sometimes thorough rather transparent interposers) for US rad-hard start-ups... is not unheard of.)

1

Have you observed what China did in the case of high-speed railways?

During the 1990s, inspired by Japan's Siankeshen, China undertook its high-speed railway R&D projects. After rolling out several prototypes from 1996 to 2002, they stopped working on domestic systems, citing that the domestic technological know-how was insufficient to take them further. Their final wholly domestic high-speed train project was ChinaStar, which was dragged on until 2006 but was finally abandoned.

Sensing their imminent domestic R&D failure, they started seeking the purchase of Japanese Siankenshen technology in 2003. From 2003 to 2008, they purchased every high-speed railway technology available on the face of the earth. By 2012, they became the largest operator of high-speed trains, and by 2014, they became the largest vendor of high-speed railway technology.

The following is their high-speed railway network nowadays:

enter image description here

The following is one of several dozens of their railway stables:

enter image description here

This anecdote could be a little longer than expected. However, this is precisely why the USA is scared of China.

I.e., the Chinese are inhumanly fast and efficient at getting used to new technologies and cultivating them in their technology incubators. Therefore, if they can get a hand on the US clean energy and climate adaptation technology, they will be the leaders in this field in at most a decade.

4
  • I guess you've not heard about all the high-speed rail crashes and other problems.
    – Stuart F
    Sep 16 at 8:28
  • In your conclusion, what specific "US clean energy and climate adaptation technology" are you referring to? Does the US have some tech that isn't available to China?
    – JJJ
    Sep 16 at 19:54
  • @JJJ, I haven't searched the Internet well, but one technology that comes to mind is electricity generators for hydroelectric projects. Last time I checked, Chinese companies working on a Pakistani hydroelectric project installed GE turbines imported directly from the USA. I think they can build turbines but are not as efficient as the USA.
    – user366312
    Sep 16 at 20:11
  • I see this under the wider umbrella that in China (and a few other places) intellectual property rights are not observed in the sense they are in the West in general and the US in particular. When the rights of individuals (or individual small companies) are subordinate to the rights of the state, the culture for IPR never really develops. A few people in the academia say that plagiarism is also common there - possibly for similar cultural reasons (it is not really seen as cheating the way it is in other parts). Sep 17 at 9:29

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .