The Biden administration recently proposed new restrictions on U.S. investments in China’s tech sector, sparking concerns among investors about potential retaliation from Beijing. These restrictions, which target sensitive tech areas like computer chips, artificial intelligence (AI), and quantum information technologies, are aimed at limiting China’s access to capital and knowledge that could enhance its military and economic capabilities. The move has raised speculation about possible retaliation measures from China, such as export restrictions on rare earth minerals and reducing dependencies on vital goods from the U.S. Investors are already taking precautions by reducing their exposure to China. However, these restrictions come as a response to national security concerns regarding the use of U.S. technology in China. The proposed rule is currently in a public comment period.
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