Here's a new development, guess I'm voting, "Team Trump".
China warned the United States on Wednesday not to adopt
punitive currency policies that could disrupt U.S.-China relations after Donald Trump’s win in the Nevada caucus.
Foreign Ministry spokeswoman Hua Chunying told reporters in Beijing that “we are following with interest the U.S. presidential election.”
Hua was asked about China’s response to a possible Trump presidency and his announced plan to punish China for currency manipulation with a tax on
“Since it belongs to the domestic affair of the U.S., I am not going to make comments on specific remarks by the relevant candidate,” she said.
“But I want to stress that China and the U.S., as world’s largest developing and developed countries, shoulder major responsibilities in
safeguarding world peace, stability and security and driving world development,” the spokeswoman added.
“The sustained, sound and steady growth of China-U.S. relations serves the fundamental and long-term interests of the two countries and benefits the
world. We hope and believe that the U.S. government will pursue a positive policy toward China in a responsible manner.”
The comments came as Wang Yi, the Chinese foreign minister, is holding talks in Washington that include U.S. concerns about a Chinese military buildup
on disputed islands in the South China Sea, and cooperation on dealing with North Korea’s nuclear and missile provocations.
Hua said Wang and Secretary of State John Kerry agreed the two sides will enhance cooperation and increase talks and exchanges.
“We stand ready to preserve and advance China-U.S. relations together with the U.S. side,” she said.
Kerry said he spoke to Wang about reducing tensions and finding diplomatic solutions to competing South China Sea claims.
“We want there to be a halt to the expansion and militarization of occupied features,” Kerry said. “Everyone benefits by true demilitarization,
Kerry also said the United States remains committed to freedom of navigation and overflight, “something which China says it does not stand in the
way of; it agrees that there should be peaceful freedom of navigation.”
Reports from Asia say Chinese state-run media have been ordered by the Communist Party to minimize reporting on the U.S. presidential election.
Hong Kong’s Chinese-language news outlet Oriental Daily reported Feb. 5 that the Party’s Propaganda Department, which sets policies for all
state-run media, ordered all publications to ban election coverage of U.S. policies toward China and to focus election coverage on negative stories
Trump won the Nevada caucus with 45 percent of the vote, increasing his chances of winning the Republican nomination later this year.
Last month, Trump vowed to impose a 45 percent tariff on Chinese good to offset China’s devaluation of the yuan.
“They’re devaluing their currency, and they’re killing our companies,” Trump said. “We are letting them get away with it, and we can’t let
them get away with it.”
The Obama administration has adopted conciliatory policies toward China on trade and currency issues.
Trump, on his campaign website, outlined a hardline approach to dealing with China that involves officially declaring China a currency manipulator and
negotiating an end to the practice.
Trump also wants to thwart China’s theft of intellectual property and adopt policies aimed at bring jobs back from overseas to the United States.
Bolstering the U.S. military and “deploying it appropriately in the East and South China Seas” are other goals.
“These actions will discourage Chinese adventurism that imperils American interests in Asia and shows our strength as we begin renegotiating our
trading relationship with China,” the Trump website states. “A strong military presence will be a clear signal to China and other nations in Asia
and around the world that America is back in the global leadership business.”
And more importantly:
WASHINGTON/NEW YORK (Reuters) - A spate of proposed Chinese takeovers of U.S. companies, from the Chicago Stock Exchange to makers of high-end
semiconductors, has created a vibrant business for a small circuit of Washington insiders who advise on how to get cross-border deals approved by the
Several former U.S. officials have in recent years joined the ranks of lawyers, consultants and lobbyists that have emerged as key brokers in trying
to get Chinese acquisitions or investments in U.S. companies approved by the Committee on Foreign Investment in the United States (CFIUS), which
scrutinizes deals for national security concerns.
Because this interagency panel, comprising 16 U.S. government departments or agencies and chaired by the Treasury, does not publish its decisions or
its reasoning for them, advisers say inside knowledge and connections are important to navigate what outsiders often see as a "black-box" review
There have been 22 M&A transactions announced in the United States so far in 2016 involving Chinese acquirers, worth a combined $23 billion, according
to Thomson Reuters data. That is a massive increase from 88 deals worth $13 billion for all of 2015, and 88 deals for $7 billion in 2014.
For a graphic showing Chinese acquisitions of U.S. companies by number and value, see tmsnrt.rs...
It has all boosted corporate demand for former officials who served on CFIUS or have knowledge of the inner workings of the agency, several lawyers,
consultants and lobbyists involved in the advisory work told Reuters.
"We're just completely overwhelmed," said one lawyer involved in advising on the CFIUS process, who asked not to be named because he was not
authorized to speak with the media.
China's aggressive, often state-backed overseas buying spree has set off alarm bells among some politicians in Washington who are already on edge as
China’s armed forces expand their presence in the South China Sea and because of high-profile hacking attacks against U.S. government agencies and
corporations, which U.S. officials and security software companies have blamed on China.
Adding to the tensions are attacks on China’s trade policy, and in particular its surplus with the U.S., by Donald Trump, who is leading the race to
be the Republican candidate in November’s presidential election.
Among the former officials who use their CFIUS experience in advisory work are Anne Salladin, who reviewed some 500 deals that went to CFIUS during
her 20 years at the Treasury. Her role at law firm Stroock & Stroock & Lavan LLP has included advising a Chinese private equity firm on the
acquisition of some semiconductor-related assets. Other officials include former U.S. Treasury deputy assistant secretary for investment security and
policy Nova Daly, now with the law firm Wiley Rein LLP, and former Department of Homeland Security assistant secretary for policy Stewart Baker, now
with law firm Steptoe & Johnson LLP, according to the websites of their employers.
Baker worked on the acquisition of Motorola Mobility by Chinese PC and smartphone maker Lenovo Group in 2014, while Daly advised U.S. hard-disk maker
Western Digital Corp on a proposed investment by China's Unisplendour Corp Ltd that was abandoned this week amid CFIUS concerns.
All three of the former officials declined to comment for this story.
Whitney Smith, a Treasury spokesperson, declined to comment on CFIUS's relationship with company advisors.
Before a deal is announced, the advisors will often seek to gauge its chances for CFIUS approval by holding a preliminary meeting with key officials.
If the initial reaction is hostile, then this can avoid the embarrassment and cost of announcing a deal that is later scuppered, said Mark Plotkin, a
CFIUS expert with the law firm Covington & Burling LLP.
A good CFIUS advisor will figure out what issues might crop up in a certain deal – such as cutting edge chip technology or Pentagon contracts -- and
discuss how to best handle these with the agencies most likely to be concerned, said Plotkin.
"The CFIUS process is going to be a full-body X-ray of the target," he said.
Another lawyer involved in CFIUS work, who spoke privately, said that he gives a 45-minute presentation to Pentagon officials and then carefully
examines the questions asked, as well as body language, to judge their level of discomfort with a particular deal.
It is not unlike a preliminary meeting that antitrust lawyers might request with the Justice Department or Federal Trade Commission about an antitrust
review of a merger, the lawyers said.
Not all CFIUS advisors are hired to help a deal go through. Some are brought in by corporate competitors to lobby against a deal, while others are
tapped by investors making bets on whether a transaction will be cleared by CFIUS. For instance, Mario Mancuso, a partner at law firm Kirkland & Ellis
LLP who formerly sat on CFIUS as undersecretary of commerce for industry and security, now typically advises companies. But he also represented some
investors in pork producer Smithfield Foods when China's Shuanghui International made a successful bid for the company in 2013.
MORE WILLING TO HIRE
This CFIUS advisory business is also benefiting from Chinese companies’ new willingness to spend on advisors.
Traditionally, Chinese companies had been mistrustful of advisors, or unwilling to pay for them, some investment bankers and lawyers say. But the
Chinese government’s encouragement of outbound deal-making has spurred many of the country’s companies to spend on advisors, including CFIUS
experts, these people say.
A CFIUS review typically lasts between one and three months and can cost from as little as $50,000 to as much as $1 million for more complicated or
controversial transactions, according to a CFIUS expert who has shepherded deals through the process.
China led the pack of countries whose planned U.S. acquisitions and investments in 2014 were probed for U.S. security implications, making it the most
scrutinized country by CFIUS, according to the latest CFIUS annual report, which was released last Friday. No official data is available for 2015.
Chinese bids for technology and chip makers get particular scrutiny, CFIUS experts say. Semiconductors form electronic cores for a long list of
military systems, including drones, guided missiles and bombs.
To be sure, even with expert advice, companies can get it wrong. In the case of Western Digital, the company had told investors that it believed
Unisplendour acquiring a 15 percent non-controlling stake would not be subject to a CFIUS review But CFIUS informed Western Digital it would review
the transaction nonetheless, prompting Unisplendour to pull out.
CFIUS concerns also killed other semiconductor deals in the past few weeks. Fairchild Semiconductor International Inc earlier this month rejected an
acquisition offer from China Resources Microelectronics Ltd and Hua Capital Management Co Ltd, over concerns that CFIUS would stop the deal. Last
month, Philips scrapped a $3.3 billion deal to sell a division which makes LED lights to Chinese investors also because of CFIUS concerns.
U.S. politicians have also began to agitate over some of these deals. Last week, a group of 46 U.S. lawmakers urged CFIUS to take a hard look at a bid
by Chongqing Casin Enterprise Group to buy the Chicago Stock Exchange because of concerns that China would gain access to information about U.S.
COTTAGE INDUSTRY The cottage industry that has developed around CFIUS includes a wide array of actors.
Law firms such as Skadden, Arps, Slate, Meagher & Flom LLP and Covington & Burling offer to provide insight into how CFIUS will view a deal, tapping
into their working relationships with CFIUS officials at several government departments. Skadden declined comment for this story.
Lobbying firms, including Podesta Group and BGR Group, both of whom boast CFIUS experts on their websites, seek to persuade lawmakers and U.S.
officials that a transaction is not threatening, as any concerns they harbor can trickle down to CFIUS officials, according to industry sources. BGR
declined to comment, while Podesta did not respond to requests for comment. Management consulting firms, such as Accenture Plc and Deloitte Touche
Tohmatsu Ltd, offer to help companies address national security risks identified by CFIUS. So-called "mitigation measures" can range from asset sales
to ensuring that only U.S. citizens perform certain tasks. Deloitte declined to comment. Sorting out who among the advisors have connections and
insight into CFIUS is not always easy.
"Some of the law firms specializing in this stuff are excellent, while others sign companies on for terms that are utterly unimplementable," said
Accenture consultant Andrew Walker, who helps companies comply with conditions imposed by CFIUS.
edit on 24-2-2016 by seentoomuch because: The second article source