Chinese econ woes, new US capital restrictions

Dealbook NYT by Andrew Ross Sorkin


The Biden administration is expected to announce new restrictions today on investing in China, its latest effort to prevent Beijing from accessing advanced technologies that could be used by its military.

The new measures add to the challenges facing the world’s second-largest economy as it faces a post-pandemic slowdown. But they also highlight the growing difficulties for and global companies operating in China, a day after a major Western law firm said it would leave the country.

The rules will focus on high-tech sectors. Biden’s executive order will bar private equity and venture capital firms from investing in Chinese industries including quantum computing, artificial intelligence and advanced semiconductors, people familiar with the deliberations told the Times.

China’s economy is already being squeezed. Official data released today showed the country had fallen into deflation last month, a day after Beijing reported that trade had plummeted by the most since the start of the pandemic.