US Imposes Sanctions On Six Chinese Companies

US Imposes Sanctions On Six Chinese Companies

The Biden administration has imposed new sanctions on China, targeting the country’s several companies for supporting Beijing’s military modernization efforts, as part of its response to a Chinese spy balloon that traversed U.S. airspace last week, The New York Times reported.

The Commerce Department added five Chinese companies and one research institute to its so-called entity list, which will prevent companies from selling them American parts and technologies without a special license. Officials said the six entities had supported Chinese military programs related to airships and balloons used for intelligence and reconnaissance, the publication reported.

Earlier this week, the US Commerce Department added five Chinese companies and one research institute connected to Beijing’s aerospace programs including airships and balloons to an export blacklist.

The Commerce Department said the six entities were supporting “China’s military modernization efforts, specifically the People’s Liberation Army’s (PLA) aerospace programs including airships and balloons.”

The Chinese government has tried to downplay the incident, arguing that the balloon was a civilian device for monitoring weather.

The entities that the United States targeted Friday were Beijing Nanjiang Aerospace Technology Company, Dongguan Lingkong Remote Sensing Technology Company, Eagles Men Aviation Science and Technology Group Company, Guangzhou Tian-Hai-Xiang Aviation Technology Company, Shanxi Eagles Men Aviation Science and Technology Group Company and China Electronics Technology Group Corporation 48th Research Institute, The New York Times reported.

The Commerce Department did not specify whether the companies and the institute had played a direct role in developing or operating the balloon that flew across the United States. But the Biden administration said earlier this week that it would consider taking action against any entities that had aided the balloon’s flight.

The balloon was shot down by a highly advanced US fighter jet last week. President Joe Biden congratulated US fighter pilots for taking down the balloon in the country’s airspace and above its territorial waters.

The Pentagon decried what it called China’s unacceptable violation of US airspace.

China has expressed regret blaming unfavourable winds for pushing what it calls a “civilian airship” into US airspace.

Beijing China insists the balloon was a “civilian airship used for research, mainly meteorological purposes,” and it unintentionally veered off into US airspace.

Notably, the US shot down the giant balloon, which China claimed to be a civilian airship used for research mainly meteorological, on February 4 after it hovered over the country for a week.

Beijing denies it uses spy balloons and says the craft was for weather research. Subsequently, it accused Washington of sending its own espionage balloons over its territory, which the US denied.

The spate had led US Secretary of State Antony Blinken to cancel a rare visit to China abruptly.

Meanwhile, the Biden administration imposed new sanctions on China, targeting the country’s several companies for supporting Beijing’s military modernization efforts, reported GlobalSecurity.org.

The US Commerce Department on Friday said that it added five Chinese companies and one research institute connected to Beijing’s aerospace programs including airships and balloons to an export blacklist.

The Commerce Department said the six entities supported “China’s military modernization efforts, specifically the People’s Liberation Army’s (PLA) aerospace programs including airships and balloons.”

The six companies include Beijing Nanjiang Aerospace Technology Co; China Electronics Technology Group Corporation 48th Research Institute; and Dongguan Lingkong Remote Sensing Technology Co.

The other three are Eagles Men Aviation Science and Technology Group Co.; Guangzhou Tian-Hai-Xiang Aviation Technology Co.; along with Shanxi Eagles Men Aviation Science and Technology Group Co. (ANI)

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Kuwait Saves Itself From Falling Into Guanxi Trap

Kuwaiti government seems to have understood the Chinese Guanxi trap which is synonymous with bribery and corruption in China.

But its latest move of excluding Chinese-sponsored Beijing Enterprises Water Group (BEWG) from Al-Mutla’s waste water purification plant shows that the country is rectifying its past mistakes.
According to Financial Post, Guanxi is a system of mutually beneficial relationships that works as a lubricant for the wheels of the business transaction and is often synonymous with bribery and corruption in China.

Recently, Kuwait’s Ministry of Public Works disqualified the BEWG’s tender for setting up a wastewater treatment plant for Al-Mutla’s sewage station. Kuwaiti Public Works administration said that the reason behind the disqualification of BEWG’s bid was based on the ground that it was earlier involved in bribing the officials to secure the Umm Al Hayman project.

After this revelation, Kuwait’s crown prince Sheikh Al-Ahmed has directed investigative agencies to nab those involved in maladministration and misdeeds, reported Financial Post.

Financial Post reported citing the ministry of Public Works’ report that the Chinese companies are indulging in malpractices for gaining an advantage to win contracts in Kuwait.

China-sponsored companies participating in Belt and Road Initiative (BRI) projects are another manifestation of Beijing’s malafide intentions. There are widespread instances of bribery with a reported 60-85 percent of Chinese firms paying bribes to secure projects under BRI. Chinese firms are known offenders of peddling influence.

Apart from payments to lower-level bureaucrats, there have also been several notable scandals involving senior political figures receiving illegal gratification from Chinese companies, reported Financial Post.

Chinese companies are the least transparent as per Financial Post citing Transparency International’s study in 2019 based on 100 firms in 15 emerging markets. Poor business practices including delays in the completion of projects are endemic to BRI projects. Numerous Chinese firms have been debarred from World Bank and multilateral development banks for fraud and corruption including inflating costs to give bribes.

Kuwait is not the line example. In Malaysia and Kenya also the Chinese government used its Guanxi trap to gain advantages in the contracts.

Former Malaysian Prime Minister Najib Razak’s ouster in May 2018 was linked to Chinese projects under BRI. China poured out the money into Malaysia’s state development fund 1 Malaysia Berhad, known as 1MDB, by inflating the cost of infrastructure projects, Financial Post reported citing Wall Street Journal.

In exchange, China received the freedom of access to major national rail and port projects in Malaysia. Whereas in Kenya, the prosecution of Chinese officials on corruption charges showed that to bypass the systemic procedure, China employed illegitimate tactics. Kenya is facing unimaginable debt resulting from a railway project that has exceeded its budget and yielded unexpectedly low results.

These case studies corroborate the widely held beliefs that China exploits countries to provide impetus to its BRI projects. To build infrastructure projects in other countries, the interested party naturally needs to go through sets of official procedures of the recipient country. However, to bypass these procedures, China indulges in corrupt practices and executes projects abroad through unsavory means, according to Financial Post. (ANI)

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