China has restricted dual-use exports to 10 US military-related companies, including drone makers, aerospace firms and rare earth producers, citing national security concerns.
Beijing has barred government entities from purchasing products from 46 American companies, including subsidiaries of Lockheed Martin, Raytheon and General Dynamics.
The measures follow Washington's decision to add Chinese tech giants such as Alibaba and Baidu to its list of military-linked firms, deepening the strategic rivalry between the two countries.
Trade War 2.0? China Unveils Fresh Sanctions on US Defence and Tech Firms
Beijing has imposed fresh export restrictions on 10 US military-linked firms and barred government purchases from 46 American companies, escalating tensions in the ongoing US-China trade and technology dispute
Summary
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China on Monday imposed restrictions on the export of dual-use goods to 10 US military-related companies, citing national security concerns, Associated Press reported. The move comes in response to what Beijing described as the US government's "wrongful expansion" of its list of Chinese military-linked companies, the report said.
Dual-use products refer to goods and technologies that can be used for both civilian and military purposes. According to China's Commerce Ministry, the restrictions are intended to prevent sensitive Chinese technologies from reaching firms involved in US defence activities.
The sanctioned companies include drone manufacturers, aerospace contractors and rare earth producers. The list comprises AVEOX in California, Red Cat Holdings and Teal Drones in Utah, IMSAR, Jaia Robotics, Ball Aerospace, Oshkosh Defense, L3Harris Maritime Services, MP Materials and USA Rare Earth.
China has also expanded the scope of the restrictions beyond its borders. Third-country companies and individuals are prohibited from transferring Chinese dual-use products to any of the sanctioned US firms. However, Chinese exporters can seek government approval for shipments deemed "genuinely necessary."
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Procurement Ban Broadens Pressure
In a separate move, China's Finance Ministry announced that government entities would no longer be allowed to purchase products from 46 US companies.
While authorities did not specify the reason behind the decision, the list reportedly includes several subsidiaries of major American defence contractors such as Lockheed Martin, Raytheon and General Dynamics.
The procurement ban adds another layer of pressure on US defence-linked businesses operating in or supplying to China.
Escalating Trade Dispute
The latest measures follow actions taken by Washington earlier this month. The US Department of Defense added several Chinese technology companies, including Alibaba and Baidu, to its roster of firms allegedly linked to China's military.
The designation effectively blocks the companies from obtaining US military contracts. Baidu rejected the accusation, describing claims of military ties as "totally baseless."
China's Commerce Ministry argued that the US actions violate the diplomatic understanding reached between Chinese President Xi Jinping and US President Donald Trump during Trump's visit to China in May.
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As trade, technology and national security concerns become increasingly intertwined, the latest restrictions highlight how the US-China rivalry is expanding beyond tariffs into defence supply chains, critical minerals and advanced technologies.