Chinese companies hit by US trade restrictions over spy balloon incident

By Alexandra Alper and Karen Freifeld

WASHINGTON (Reuters) – The Biden administration placed 37 Chinese companies on a trade restrictions list on Thursday, including some for allegedly supporting the spy balloon that flew over the United States last year, ratcheting up tensions between Beijing and Washington.

The Commerce Department also said it was listing some units of the China Electronics Technology Group because they allegedly sought to acquire American technology to support China’s quantum technology capabilities, “which have serious implications for the national security of China due to their military applications.” USA has”.

According to media, the state-owned China Electronics Technology Group is a top supplier of military equipment.

China Electronics Technology Group could not immediately be reached for comment. The Chinese Embassy in Washington did not immediately respond to a request for comment.

The moves announced Thursday show the Biden administration continuing to punish Beijing over the spy balloon that floated over the United States in February 2023, which fueled political outrage in Washington and prompted Secretary of State Antony Blinken to cancel a trip to China.

This month, the Commerce Department added five companies and a research institute to the entity list for supporting “China’s military modernization efforts, particularly the People’s Liberation Army (PLA) aerospace programs, including airships and balloons.”

The Chinese Foreign Ministry had said it was a weather balloon that had gone off course and accused the US of overreacting.

The trade restrictions list, known as the Entity List, has been used aggressively by the United States to curb the flow of technology to China amid fears Beijing could use it to bolster its military capabilities.

Inclusion on the list will make it more difficult for US suppliers to deliver to target companies.

The Biden administration also added a handful of Chinese companies to the list on Thursday for trying to procure American goods to make drones to be used by the Chinese military and others to ship controlled goods to Russia.

(Reporting by Caitlin Webber, Karen Freifeld and Alexandra Alper; Writing by Alexandra Alper; Editing by Jonathan Oatis)