The President of the United States has issued a directive focusing on the nation's investment policy, emphasizing its importance for national and economic security. The directive highlights that foreign investment is welcome as it strengthens U.S. capital markets and supports job creation, innovation, and economic growth. However, the President notes that certain foreign adversaries, particularly the People's Republic of China (PRC), use investments to gain access to advanced technologies and strategic industries.
"Economic security is national security," the directive states, underscoring concerns about PRC-affiliated investors targeting key U.S. sectors such as technology, food supplies, minerals, and critical infrastructure. The document mentions that these investments may aid in modernizing China's military capabilities, posing risks to U.S. security.
The policy outlines several measures aimed at balancing open investment with national security needs. It includes facilitating greater investment from allied sources through an expedited "fast-track" process while imposing restrictions on investments related to critical technology and infrastructure if linked to foreign adversaries like the PRC.
"My Administration will make the United States the world’s greatest destination for investment dollars," asserts the President while emphasizing protection against predatory practices by foreign adversaries.
To protect sensitive U.S. sectors, the administration plans to use legal tools such as the Committee on Foreign Investment in the United States (CFIUS) to restrict PRC-affiliated investments in strategic areas. Additionally, there will be efforts to expedite environmental reviews for substantial investments exceeding $1 billion.
The memorandum also addresses reducing exploitation of American capital by foreign entities and considers potential sanctions under existing executive orders against investments aiding PRC's military-industrial sector.
Furthermore, a review is planned regarding existing tax treaties with China and restrictions on outbound U.S. investments in specific sectors linked to China's Military-Civil Fusion strategy.
To safeguard American investors' savings, measures include ensuring financial auditing standards are upheld for foreign companies listed on U.S. exchanges and scrutinizing ownership structures that might limit investor rights.
This comprehensive approach aims at preserving an open yet secure investment environment while deterring potential threats from adversarial nations.
