President Donald Trump’s latest move to restrict Chinese investment in strategic areas shows the president may be even more aggressive than ever toward the U.S. rival in his second term.
"Although it will take time for the necessary agency and regulatory actions necessary to implement the policy, Trump 2.0 is taking an even more hawkish approach to China as he did in his first term," Larry Ward, a national security law expert and current partner at the international law firm Dorsey & Whitney, told Fox News Digital.
The comments come after Trump signed a memorandum last week that directed the Committee on Foreign Investment in the United States (CFIUS) that aims to both promote foreign investment from some countries while restricting investment from adversaries such as China, protecting U.S. national security interests.
"The Committee on Foreign Investment in the United States (CFIUS) will be used to restrict Chinese investments in strategic U.S. sectors like technology, critical infrastructure, healthcare, agriculture, energy, raw materials, and others," reads a fact sheet about the memorandum released by the White House last week.
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The memorandum, dubbed the National Security Presidential Memorandum (NSPM), specifically singles out China for "exploiting our capital and ingenuity to fund and modernize their military, intelligence, and security operations, posing direct threats to United States security with weapons of mass destruction, cyber warfare, and more," according to the White House release.
"Chinese hackers have repeatedly targeted U.S. entities, including recently breaching the Treasury Department’s CFIUS office, the entity responsible for reviewing foreign investments for national security risks," the release adds.
While Trump has in the past imposed tariffs on China, Ward argued that the president’s new policy is a further step in aggressively responding to the threat posed by China.
"This is very different from tariffs. It's different from trade concerns. Foreign investment is an issue that potentially impacts national security," Ward said.
Ward noted the example of the social media application TikTok, which has famously been at the center of a debate about protecting Americans from potentially being targeted by China.
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"TikTok initially went through the CPA process and was examined on a national security basis, and then the determination was made that there were national security concerns," Ward said.
Ward noted that Chinese investment in certain sectors has faced restrictions for years, but Trump’s move makes clear that such restrictions are likely to expand beyond those that investors have traditionally seen.
"So you look at sectors like semiconductors, the AI space increasingly is a tech sector that has been a general focus," Ward said. "But certainly this policy again puts out in front that, yes, certainly as to those sensitive industry sectors, we are going to be very stringent when it comes to Chinese investment, but also we're going to expand into other industry sectors that maybe haven't been sort of front and center over the last five, 10 years."
Responding to Trump’s move, the Chinese commerce ministry accused the U.S. of "politicizing" and "weaponizing" economic issues, according to a report from Reuters, adding that it would continue to closely monitor the situation to defend its interests.
Nevertheless, Ward believes Trump’s memorandum signals that the president is more committed than ever to combating Chinese threats to U.S. security.
"The biggest thing about this policy is that President Trump is not afraid to say that really the threat here is China," Ward said. "Everybody that sort of works in this space knows that, but it was the elephant in the room, right? People sort of weren't willing to speak about it publicly. And President Trump has really come out and said through this policy, yeah, China's the concern."
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