US firms claim China is now unattractive for investment, according to Commerce Secretary.

U.S. Commerce Secretary Gina Raimondo revealed that American companies are ⁢finding⁢ China⁤ “uninvestable” ⁣due to the increasing risks associated​ with doing business there. She made these remarks ⁢during her official ⁣visit to ‌China while on a train ‍from ‌Beijing​ to Shanghai.

“Increasingly I hear from American business that China is uninvestible because it’s become ‌too risky,”​ Ms. Raimondo stated.

Secretary Raimondo’s visit to China aims to strengthen economic ties amidst concerns of‍ escalating​ political tensions between the two countries.

‘Raids on Businesses’

According to Ms. Raimondo, U.S. companies operating in⁤ China are facing​ numerous challenges, including “exorbitant fines ​without any explanation” and ‌”unclear ⁢revisions to the ‍counterespionage⁣ law, which are causing concern among ⁤the ⁤U.S. community.”

The commerce secretary highlighted the issue⁢ of​ “raids on businesses” as⁢ one of the major problems American firms encounter in China, collectively presenting‍ “a whole new level ​of challenge” ‍that needs to be addressed.

An example⁣ of arbitrary⁣ crackdowns faced by U.S. companies in China is the ⁣recent ban imposed by Beijing on American⁢ chipmaker Micron Technology’s semiconductor​ sales to key Chinese domestic industries.

Ms. Raimondo mentioned the ‍Micron ban in her ‍statements to reporters, expressing concern over the lack of explanation and the⁢ restrictions imposed without proper due process.

The Chinese embassy in Washington has not yet responded to⁢ the commerce secretary’s remarks.

Ms. ‍Raimondo’s statements highlight the significant ‌friction in commerce between China and the United States, including tit-for-tat export controls.

Bilateral ties between Beijing and Washington have deteriorated this year due to‍ various issues, such as aggressive Chinese military actions around Taiwan and allegations of spying.

In April, Washington⁢ implemented new restrictions on exports to ‍China to prevent the transfer of semiconductor and other technologies to Beijing’s military. In response, China announced export‍ controls on two strategic metals, seen ⁤as a retaliatory move.

In an‌ effort to mend strained relations, Ms. Raimondo announced the establishment⁢ of a working group on ⁣trade and investment⁢ issues, including export controls. However, this decision received ⁢criticism‌ from ⁢House Foreign⁤ Affairs Committee Chairman Rep. Michael McCaul (R-Texas), who‍ deemed it “dangerous.”

“The Biden administration’s decision to join forces with​ the Chinese Communist Party to establish ⁢a working group ‍on export controls and commercial issues with CCP officials ​is at best naive, but also ⁤dangerous,” stated Mr. McCaul.

Michael Hart, the president of the American Chamber of ​Commerce in China, responded⁢ to Mr. McCaul’s remarks during an interview on CNBC. He downplayed the comments as ⁣a⁣ “political take on the issue” and emphasized the importance of ⁣continued trade from ‍the perspective of ⁢the American Chamber of Commerce. He‌ noted that many U.S. businesses still consider China an important market.

Regarding Ms. Raimondo’s ​visit, Mr. Hart mentioned that⁤ she holds both “the carrot and the stick” as she oversees both trade and export controls, making the Chinese eager‌ to engage with her.

Decoupling

Ms. Raimondo is the fourth senior‌ U.S. official to visit China in ⁣the past 10 weeks.

During her visit, she met several high-ranking ⁤Chinese officials and conveyed a message to Premier Li Qiang about the Biden administration’s commitment ‍to maintaining trade ties rather than seeking to decouple.

“I have⁢ had ‌a⁣ very productive visit so far,” Ms. Raimondo ‌told Mr. Li ⁢before their closed-door sessions. “President Biden ⁣asked me ⁤to come here to convey a message ‍that we do​ not⁤ seek to decouple; we seek to‌ maintain our $700 billion commercial relationship.”