China has urged the United States to halt a proposed expansion of restrictions on American investment in sensitive Chinese technology sectors, opening another front in the economic competition between the world’s two largest economies.
China’s Commerce Ministry said it opposed the proposed rules and reserved the right to take unspecified countermeasures. Beijing argued that the measures would expand discriminatory restrictions on Chinese companies and damage bilateral economic ties.
The response follows a proposal from the U.S. Treasury Department to significantly expand the Outbound Investment Security Program.
Existing restrictions cover certain investments involving semiconductors, quantum technologies and artificial intelligence.
The proposed framework would add biotechnology while expanding coverage of high-performance computing, supercomputing and hypersonic systems.
The objective is to prevent U.S. capital from supporting technologies that could strengthen the military, intelligence, surveillance or cyber capabilities of foreign adversaries.
The proposal remains subject to public comment and is not yet a final rule.
The economic significance extends beyond companies directly covered by the restrictions.
American pharmaceutical companies increasingly rely on Chinese biotechnology firms for drug research and licensing relationships, while U.S. investors remain important sources of capital for technology companies operating across advanced computing and artificial intelligence.
Broader restrictions could therefore affect venture capital, private equity, corporate investment and cross-border technology partnerships.
The development also illustrates how U.S.-China economic competition is expanding beyond tariffs and semiconductor exports.
Capital itself is increasingly becoming part of national-security policy.
For markets, the next questions are whether Washington narrows or expands the proposal after public comments and whether Beijing responds with investment, trade or technology restrictions of its own.
