China has begun restricting its companies from making new investments in the United States, according to confidential sources familiar with the situation.
Several branches of China’s top economic planning agency, the National Development and Reform Commission (NDRC), have been directed to suspend both registration and approval processes for firms looking to invest in the US.
While China has previously limited certain overseas investments for national security and capital control reasons, these new measures reflect the escalating tensions between the world’s two largest economies.
The restrictions appear to be limited to new investments and don’t affect existing commitments or holdings of US Treasuries. The timing aligns with President Trump’s plans to announce reciprocal tariffs on Wednesday that will likely include China, following his February memorandum directing limitations on Chinese investments in strategic US sectors. Chinese outbound investments to the US totaled $6.9 billion in 2023.