 "China sanctions 20 US defence firms, executives over Taiwan arms package")
China announced sanctions against 20 US defence companies and their senior executives on Friday (December 26), escalating tensions with Washington after the US unveiled what could become its largest-ever arms sales package to Taiwan. The sanctions were imposed in response to a proposed American weapons deal valued at $11.1 billion, which Beijing said violated core principles governing China-US relations, according to a report by the South China Morning Post.
Which US defence firms have China banned?
China’s foreign ministry said the US arms package “seriously violates the one-China principle and the three China-US joint communiques, interferes in China’s internal affairs, and undermines China’s sovereignty and territorial integrity”. The sanctioned firms include:
Northrop Grumman Systems Corporation; L3Harris Maritime Services; Boeing (St Louis); Gibbs & Cox; Advanced Acoustic Concepts; VSE Corporation; Sierra Technical Services; Red Cat Holdings; Teal Drones; ReconCraft; High Point Aerotechnologies; Epirus; Dedrone Holdings; Area-I; Blue Force Technologies; Dive Technologies; Vantor; Intelligent Epitaxy Technology; Rhombus Power; and Lazarus Enterprises.
Under the sanctions, the affected companies’ movable and immovable property and other assets within China will be frozen. Chinese organisations and individuals are also prohibited from conducting transactions or cooperating with these firms.
Additionally, 10 senior executives linked to the arms sales will be denied visas and barred from entering mainland China, Hong Kong and Macau.
Those sanctioned include Palmer Luckey, founder of Anduril Industries, and John Cuomo, president and chief executive of VSE Corporation.
What the US is proposing to sell to Taiwan
The arms package, announced by the US State Department late last week, still needs approval from the US Congress but if cleared, it would be the largest US weapons sale to Taiwan to date.
The eight proposed agreements cover 82 High Mobility Artillery Rocket Systems (HIMARS) and 420 Army Tactical Missile Systems (ATACMS), similar to those supplied to Ukraine during the Biden administration, with a combined value of more than $4 billion.
The package also includes 60 self-propelled howitzer systems and related equipment worth more than $4 billion, as well as drones valued at more than $1 billion.
Other components include military software valued at over $1 billion, Javelin and TOW missiles worth more than $700 million, helicopter spare parts worth $96 million, and refurbishment kits for Harpoon missiles worth $91 million.
US’ u-turn on Taiwan defence sales after earlier pause
The announcement marks a reversal from earlier this year, when in September, Trump had declined to approve a military aid package worth more than $400 million for Taiwan, as he sought progress on a trade deal with China at that time, as reported by The Washington Post.
That shipment, which included munitions and autonomous drones, was rejected during the summer, though the decision was described as potentially reversible.
The reported pause reflected the administration’s view that Taiwan should purchase US weapons rather than receive them through the Presidential Drawdown Authority, which had been used multiple times under the Biden administration.
Taiwan ramps up defence spending
Amid all this, it is important to note that Taiwan has stepped up its own defence commitments amid growing pressure from Washington to increase military spending.
President Lai Ching-te’s government last week approved special funding to acquire additional drones and naval vessels. In November, Taiwan announced the introduction of a $40 billion supplementary defence budget.
Lai has said that he hopes to raise defence spending to 5 per cent of gross domestic product by 2030. Unveiling the proposed package, he said history showed that compromise in the face of aggression led to “enslavement”, referring to China.
Beijing considers Taiwan part of China and has not ruled out using force to achieve reunification. And most countries, including the US, do not recognise Taiwan as an independent state.
But Washington is legally bound to provide Taiwan with weapons for its defence, a position that continues to sit right in the middle of worsening US-China tensions.