China National Offshore Oil Corp (CNOOC), the largest oil drilling company in China, will be subject to new US sanctions, which are being prepared before the president’s departure Donald Trump , reports Reuters citing sources in the White House.
The reason for the restrictive measures will be drilling in the South China Sea, which Washington considers to be a military fortification, the dean of the Institute for Energy Policy Research of the People’s Republic of China at Xiamen Ling Bosen suggests.
For CNOOC, the sanctions will be a serious blow. The company has joint projects with ExxonMobil , it uses American equipment, it has outstanding debt of $ 20 billion. Foreign investors own 16.5 percent of the capital, so the company will have to find outside funding. Against this background, its shares fell by 14 percent.
China Construction Technology Co Ltd, China International Engineering Consulting Corp and Semiconductor Manufacturing International Corp (SMIC) will also be listed for restrictive measures. The latter is the largest Chinese manufacturer of microcircuits and a key company for the PRC in the development of its own microelectronics.
Before that, SMIC has already hit under the scope of US sanctions. Semiconductor suppliers were required to obtain a license to sell overseas, and the condition included a requirement to prove that the equipment would not be used for military purposes. The company claims that it has nothing to do with the military or special services, but it will be difficult for it to justify this.
In addition, SMIC was seen as a replacement for Taiwanese TSMC as a supplier of microchips for Huawei smartphones. But the company itself came under sanctions for its links with the Chinese military and intelligence agencies.
Official representative of MFA of China Hua Chunying expressed hope that the United States will refrain from introducing new trade barriers that will hit Chinese companies.