Tencent’s headquarters in Shenzhen.Photographer: Qilai Shen/Bloomberg
The US Department of Defence has announced the inclusion of Chinese tech corporations Tencent Holdings and CATL in the list of companies associated with the Chinese armed forces. This news caused a significant decline in the value of both companies’ shares and increased tensions between the world’s two largest economies, Reuters reports.
Tencent shares listed on the Hong Kong Stock Exchange lost 7.3%, equivalent to $35.4 billion in market value. Shares of CATL, the world’s largest manufacturer of batteries for electric vehicles, fell by 2.8%, reducing the company’s market capitalisation by $4.4 billion.
Reaction of companies and China
Tencent and CATL have already condemned the US decision. Tencent said that its business would not be affected and that the company would initiate a review of the decision or take legal action. CATL stressed that it is not involved in military-related activities.
China’s Foreign Ministry called Washington’s actions “illegal sanctions” and called on the US to immediately lift them, adding that Beijing would protect the interests of its companies.
List of companies with military connections
The updated list includes 134 companies, including, in addition to Tencent and CATL, chipmaker Changxin Memory Technologies, drone manufacturer Autel Robotics, and transport giant COSCO Shipping Holdings. The decision may complicate cooperation between US companies and these firms due to reputational risks.
Potential consequences
Experts note that inclusion in this list does not impose immediate bans, but creates the basis for future sanctions, including possible restrictions on investment by the United States.
“The US is no longer limited to a few technologies,” explains analyst Craig Singleton, “Sensitive technologies cover a wider spectrum, and the West is tightening its grip on this area.”
Tensions continue to rise
The move is part of a broader effort by Washington to limit the influence of Chinese technology due to potential threats to national security. Beijing, for its part, continues to condemn such actions, calling them politically motivated.
This is another manifestation of the strategic confrontation between the US and China, which affects not only the economy but also the global technology market.
