The New York Stock Exchange has begun the process of removing three Chinese telecom companies from its list, seeking to comply with an order from President Donald Trump’s administration prohibiting investing in companies with ties to the Chinese military.
This comes as relations deteriorate between the two largest economies in the world over several contentious issues, ranging from trade and the Coronavirus to Hong Kong and Xinjiang.
The exchange said in a statement on Friday that trade in China Mobile Communications, China Telecom, and China Unicom (Hong Kong) Ltd. will end within the next week, subject to the settlement of transactions.
In November, President Trump signed an executive order prohibiting Americans from investing in Chinese companies believed to supply or support military and security services in Beijing, prompting a sharp reaction from China.
The order listed 31 companies it said China was using to “increasingly exploit” US investment capital to finance military and intelligence services, including the development and deployment of weapons of mass destruction.
This came as part of a set of executive orders and regulatory measures that targeted the economic and military expansion of China in recent months.
Trump’s order bans American companies and individuals from owning shares in 31 companies.
National Security Adviser Robert O’Brien said at the time that the order would prevent Americans from inadvertently providing passive capital to Chinese companies listed on stock exchanges around the world that support the development of the Beijing military and its spy agencies.
Under the slogan “America first,” Trump portrayed China as the biggest threat to the United States and global democracy, waged a trade war against it, chased out Chinese technology companies, and blamed China for the Covid-19 pandemic.
Many other stock indices such as the Nasdaq and Dow Jones removed many Chinese companies from their lists.