Washington:
At least 70 per cent of Chinese firms, with ties to the Chinese military have affiliates whose securities are integrated in big stock indices, the US State Department stated today, adding that these firms are involved in civilian and military production with revenue from the US investors.
As of June 22, out of 31 firms with Chinese military ties had at least 68 distinct affiliated firms whose shares have been integrated on big benchmarks, South China Morning Post reported citing State Department.
“The Chinese Communist Party’s threat to American national security extends into our financial markets and impacts American investors,” the State Department stated in a reality report early this month.
“Many major stock and bond indices developed by index providers like MSCI and FTSE include malign People’s Republic of China (PRC) companies, listed on the Department of Commerce Entity List and/or the Department of Defense List of Communist Chinese military companies,” it added.
The State Department stated that China National Chemical Corporation and China Communications Construction Company have been amongst the 22 firms that have affiliates integrated in the MSCI Emerging Markets Index, FTSE Emerging Index and Bloomberg Barclays Global Aggregate Index.
On November 12, US President Donald Trump had signed an executive order that prohibits Americans from investing in these 31 firms starting on January 11 subsequent year.
Earlier this month, Washington added a further 4 firms to the blacklist, such as China’s major chip maker Semiconductor Manufacturing International Corporation and oil giant China National Offshore Oil Corporation.