A flag with the Raytheon International Inc. logo flies during preparations ahead of the Farnborough International Airshow 2016 in Farnborough, U.K., on Sunday, July 10, 2016. The air show, a biannual showcase for the aviation industry, runs until July 17.
Simon Dawson | Bloomberg | Getty Images
China on Thursday imposed trade and investment sanctions on Lockheed Martin and a unit of Raytheon for supplying weapons to Taiwan, stepping up efforts to isolate the island democracy claimed by the ruling Communist Party as a part of its territory.
Lockheed Martin Corp. and Raytheon Technologies Corp.’s Raytheon Missiles and Defense are barred from importing goods into China or making recent investments within the country, the Ministry of Commerce announced. It said they were added to the “unreliable entity” list of corporations whose activities are restricted because they could endanger national sovereignty, security or development interests.
It wasn’t clear what impact the penalties may need. America bars most sales of weapons-related technology to China, but some military contractors even have civilian businesses in aerospace and other markets.
Taiwan and China split in 1949 after a civil war. The island of twenty-two million people never has been a part of the People’s Republic of China, however the Communist Party says it’s obliged to unite with the mainland, by force if needed.
President Xi Jinping’s government has stepped up efforts to intimidate Taiwan by flying fighter jets and bombers near the island and firing missiles into the ocean.
America has no official relations with Taiwan but maintains extensive industrial and informal contacts. Washington is obligated by federal law to be sure that the island’s government has the means to defend itself.
America is Taiwan’s primary supplier of military equipment.
Raytheon Missiles and Defense, a part of Raytheon Technologies Corp., was awarded a $412 million contract in September to upgrade Taiwanese military radar as a part of a $1.1 billion package of U.S. arms sales to the island. Boeing Defense received a $355 million contract to produce Harpoon missiles.
Beijing responded to that sale by announcing sanctions against the CEOs of Raytheon and of Boeing Defense but gave no details of what they were.
Lockheed Martin has supplied Taiwan’s military with radar, helicopters and air traffic control equipment. It plays a job within the island’s development of its own fighter jet and navy frigates.
In China, Lockheed Martin has sold air traffic control equipment for civilian airports and helicopters for industrial use.
Beijing announced plans for the “unreliable entity” list in 2019 in response to U.S. restrictions imposed on Huawei Technologies Ltd., a Chinese maker of telecom equipment.
