China hits US with sanctions, drone export curbs ahead of Xi visit

Beijing announced a swath of measures against the United States and its firms on Wednesday, in what it described as retaliation against recent moves by Washington targeting Chinese companies.

The tit-for-tat sanctions come weeks ahead of an expected summit between Chinese leader Xi Jinping and President Donald Trump in the US next month, as the world’s two largest economies struggle to maintain what they’ve called “constructive strategic stability” amid an intensifying tech rivalry.

China’s Ministry of Commerce announced it was sanctioning multiple American entities, including a biotech and a resource analytics firm, and tightening export controls on drones and their related components and technologies to the US.

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Six of the companies were added to China’s so-called countermeasures list in retaliation for the US’s move last week banning imports from 43 Chinese companies over alleged human rights abuses of Uyghur and other minority groups, the ministry said.

A seventh company’s listing was linked to the US Federal Communications Commission (FCC)’s ban last month on imports of new humanoid and quadruped robots, which are largely made in China, as well as power converters.

Entities and people within China are prevented from from doing business or cooperating with the listed firms.

The US FCC had already last December banned the import and sale of new drone models and critical equipment made by foreign manufacturers, including those from China, citing national security. China, which is the world’s largest drone manufacturer, has tightened export controls on the products over recent years.

Beijing’s measures on Wednesday also included launching a national security investigation into imported office equipment with foreign system software, and suspending certain factory tracking inspection collaboration with the US.

A ministry spokesperson said Beijing had “no choice but to take necessary countermeasures” in response to recent American measures targeting Chinese firms.

“China urges the United States to immediately revoke the relevant measures, stop its erroneous actions … and work together to maintain a constructive and stable China-US relationship,” the spokesperson said.

“If the United States insists on introducing new restrictive measures against China, China will take further countermeasures.”

In addition to the ban on imports of new robots and power converters and the blacklisting of Chinese firms over alleged forced labor ties, the Trump administration in recent weeks sanctioned Chinese shipping operators alleged to be handling Iranian fuel and added new institutions, including two top civilian universities, to a Pentagon blacklist.

China was also among dozens of countries Washington last month hit with a 10% or 12.5% tariff over alleged failure to curb exports made by forced labor. And Trump administration officials have recently threatened to sanction Chinese AI firms.

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The escalation of tensions has played out alongside signs of preparation for the Xi-Trump summit expected next month.

Top US and Chinese economic officials held trade talks over video link last week. Earlier in July, a Chinese vice-foreign minister visited the US for what was widely seen as a planning trip ahead of Xi’s visit.

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