US considers tighter rules on Chinese investments

Chinese experts Thursday slammed a report that urges the US Congress to consider tighter rules on investment from China's State-owned companies, saying the report represents "cold war mentality" and will dampen economic cooperation between the countries.

The US-China Economic and Security Review Commission, a congressional advisory panel, said Wednesday in its annual report to the US Congress that investment from China's State-owned companies may pose both economic and security risks to the US.

"By some estimates, China's State sector now accounts for as much as half the Chinese economy. The Commission has recommended that Congress … consider whether we need to better monitor the activities of Chinese State-owned enterprises, especially those that seek to invest in the US," said William Reinsch, vice chairman of the commission.

"The report may indicate an extension of the Huawei incident — future Chinese investment in the US will face stricter review for sure, especially investment in the high-tech sector," Bai Ming, a researcher at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times Thursday.

Bai said it is possible that the US is trying to consolidate its leading position in the high-tech sector by warding off potential competition from China.

He also said that the commission's report indicates a "cold war mentality," and the current negative sentiment in the US toward Chinese investment may further scare off Chinese companies eyeing opportunities in the US.

However, He Weiwen, co-director of the China-US/EU Study Center at the China Association of International Trade, said that the report should be treated as an individual case and Chinese companies should also consider the bright side of cooperation with the US.

The report comes one month after the US blocked investments by Huawei and ZTE, warning that their equipment could be used for spying. And at present the acquisition of Canadian energy company Nexen by China's offshore oil producer CNOOC is pending US approval, which it needs because Nexen also operates in the US.