China has imposed trade and investment sanctions on two American defense contractors, Lockheed Martin Corp. and Raytheon Missiles & Defense, for supplying weapons to Taiwan, in what is seen as the latest effort to isolate the self-governing island which Beijing claims as part of its own territory.
The Chinese Commerce Ministry announced Thursday that both companies would be added to its “unreliable entities list,” and would be prohibited from exporting and importing activities related to China. The ministry also said that the companies would be fined an amount equivalent to twice the value of their contracts related to the sale of arms to Taiwan.
Taiwan's main source of military equipment is the United States. Raytheon Missiles and Defense was awarded a $412 million contract in September to upgrade Taiwan’s military radar, while Lockheed Martin has supplied Taiwan’s military with radar, helicopters and air traffic control equipment.
It is unclear how China will enforce the sanctions, as some US defense contractors have ties to civilian sectors. It is also unclear what effect the sanctions might have on Lockheed Martin or Raytheon. The US has already prohibited the majority of sales of weapons-related technologies to China, but some military contractors have businesses operating in the civilian aerospace and other industries.
0. “China sanctions Lockheed, Raytheon after vowing to retaliate against US restrictions” Channel3000.com – WISC-TV3, 16 Feb. 2023, https://www.channel3000.com/news/money/china-sanctions-lockheed-raytheon-after-vowing-to-retaliate-against-us-restrictions/article_9697ebf5-96cb-5582-a97d-8c0faffd68f4.html
1. “China Puts Lockheed, Raytheon on Trade Blacklist Over Taiwan Arms Sales” The Wall Street Journal, 16 Feb. 2023, https://www.wsj.com/articles/china-puts-lockheed-raytheon-on-trade-blacklist-over-taiwan-arms-sales-5006c360
2. “China announces Lockheed Martin, Raytheon sanctions in response to arms sales” China Daily, 16 Feb. 2023, https://www.chinadaily.com.cn/a/202302/16/WS63ee175ca31057c47ebaf3c0.html
3. “China sanctions Lockheed Martin, Raytheon for Taiwan sales” The Washington Post, 16 Feb. 2023, https://www.washingtonpost.com/politics/china-sanctions-lockheed-martin-raytheon-for-taiwan-sales/2023/02/16/fe011756-addc-11ed-b0ba-9f4244c6e5da_story.html
4. “China sanctions Lockheed Martin, Raytheon over Taiwan arms sales” Al Jazeera English, 16 Feb. 2023, https://www.aljazeera.com/news/2023/2/16/china-sanctions-lockheed-martin-raytheon-over-taiwan-arms