World

US blacklists China firms on human rights violations

Move likely to affect trade talks later this week

WASHINGTON : Prospects for progress in US-China trade talks dimmed after Washington blacklisted 28 Chinese companies over Beijing's treatment of predominantly Muslim ethnic minorities.

The move by the US Commerce Department could deepen divisions between Washington and Beijing at a critical juncture in their 15-month trade war that has roiled financial markets and triggered a slowdown in the global economy.

Mr Trump and his top economic adviser, Mr Larry Kudlow, spoke in generally upbeat terms about this week's discussions with China, the first such high-level talks in more than two months although Mr Trump insisted he would not be satisfied with a partial deal.

"We think there's a chance we could do something very substantial," he said, referring to minister-level talks scheduled for the end of the week.

"I would much prefer a big deal and I think that's what we're shooting for."

Pressed to elaborate on chances of progress this week, Mr Trump sounded more sceptical.

"Can something happen? I guess, maybe. Who knows. But I think it's probably unlikely."

The decision to blacklist the companies drew a sharp rebuke from Beijing.

TARGETED COMPANIES

The US has targeted 20 Chinese public security bureaus and eight companies, including video surveillance company Hikvision, as well as leaders in facial recognition technology SenseTime Group and Megvii Technology.

The action bars the companies from buying components from US ones without US government approval - a potentially crippling move for some of them.

It follows the same blueprint used by Washington in its attempt to limit the influence of Huawei for what it says are national security reasons.

The US Commerce Department said in a filing the "entities have been implicated in human rights violations and abuses in the implementation of China's campaign of repression, mass arbitrary detention, and high-technology surveillance against Uighurs, Kazakhs and other members of Muslim minority groups".

China said the US should stop interfering in its affairs.

It will continue to take firm and resolute measures to protect its sovereign security, Chinese Foreign Ministry spokesman Geng Shuang told a regular media briefing.

Hikvision, with a market value of about US$42 billion (S$58 billion), calls itself the world's largest maker of video surveillance gear.

SenseTime, valued at around US$4.5 billion, is one of the world's most valuable artificial intelligence (AI) unicorns while Megvii, backed by e-commerce giant Alibaba, is valued at around US$4 billion and is preparing an initial public offering to raise at least US$500 million in Hong Kong.

The other companies on the list are speech recognition company iFlytek, surveillance equipment maker Zhejiang Dahua Technology, data recovery company Xiamen Meiya Pico Information, facial recognition company Yitu Technology and Yixin Science and Technology.

SenseTime said it was deeply disappointed by the US move, that it abides by all relevant laws of the jurisdictions in which it operates and it has been actively developing an AI code of ethics to ensure its technologies are used responsibly. - REUTERS

BUSINESS & FINANCE