Xiaomi’s shares fell this Friday (01.15.2021) at the opening of the Hong Kong Stock Exchange after the United States included the world’s third largest mobile phone manufacturer on a blacklist of companies considered a threat to national security.
This last-minute inclusion of Chinese companies under sanctions is the latest chapter in four years of diplomatic tensions between Beijing and Washington under the presidency of Donald Trump.
The benchmark index of the Hong Kong Stock Exchange, the Hang Seng, closed with a rise of 0.27% despite the collapse of the Xiaomi technology. At the end of the session, Xiaomi had fallen 10.26%.
With only six days to go before the end of the outgoing US president’s term, authorities made a series of announcements against the Chinese mobile phone maker, as well as against the video app TikTok and the oil giant CNOOC.
Xiaomi, the third world manufacturer of smartphones
Xiaomi, which surpassed Apple by becoming the world’s third-largest smartphone maker in 2020, is one of the nine Chinese companies on this blacklist, due to its alleged ties to the Chinese military.
This measure means that US investors will not be able to buy Xiaomi shares and will have to sell the ones they have unless future President Joe Biden reverses the measure.
In a statement, the US Department of Defense said it was “determined to expose and counteract the development strategy of the civil-military merger of the People’s Republic of China” that would allow it to access essential technology and security data. Washington had already adopted similar sanctions against companies such as phone maker Huawei and electronic card giant Smic, thus slowing their ability to impose key technologies and compete internationally.
FEW (AFP, EFE)