China Bans All Trade With US Defense Contractors Lockheed Martin, Raytheon
The Chinese government has imposed sanctions, travel bans, and fines on US defense contractors Lockheed Martin and Raytheon Technologies.
As Bloomberg reports(Opens in a new window), the sanctions are in response to both companies choosing to sell arms to Taiwan, which China claims as part of its territory. Lockheed and Raytheon now have their names on an "Unreliable Entity List(Opens in a new window)" in China and all trade with them in banned by the Chinese government.
Additionally, neither company is allowed to make any new investments within China, have individuals from their senior management team visit China, and all existing work permits and residencies will be disapproved.
Such restrictions will make it difficult for Lockheed and Raytheon to pay the fines they have also been hit with, which total twice the contract value they were paid for the arms sales to Taiwan. It's unlikely either company would even consider paying, but they could increase if not paid within 15 days. Neither company has much exposure to China and therefore the sanctions are being viewed as "largely symbolic."
The action taken by China currently pales in comparison to the restrictions imposed by the US on Chinese companies. The US government's export sanctions have made it increasingly difficult for China to source and use the most advanced chips, to the point where the country's future probably lies with RISC chips. Meanwhile, the recent spy balloon fiasco has resulted in yet more Chinese entities being added to a blacklist.
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