China on Thursday added Lockheed Martin and a unit of Raytheon Technologies to an “unreliable entities list” over arms sales to Taiwan, prohibiting them from exports and imports related to China in its latest sanctions against the U.S. firms.
The measures come amid escalating tensions after the U.S. military shot down what it alleged was a Chinese spy balloon, and a day after Beijing cautioned of “countermeasures against relevant U.S. entities that undermine China’s sovereignty and security”.
Raytheon Missile and Defense Corp, a subsidiary of Raytheon Technologies Corp (RTX.N), and Lockheed Martin Corp (LMT.N) are banned from “engaging in import and export activities related to China,” China’s commerce ministry said in a statement.
Neither company supplies defense products to China. Raytheon would not comment. Raytheon Technologies supplies its Pratt & Whitney aircraft engines, along with landing gear and controls, to China’s commercial aviation industry.
Lockheed, which exports to more than 70 nations, said in a statement, “Foreign Military Sales are government-to-government transactions and we work closely with the U.S. government on any military sales to international customers. Lockheed Martin closely adheres to United States government policy with regard to conducting business with foreign governments.”
Lockheed assembles the F-22 Raptor fighter jet, which flew the mission to shoot down an alleged Chinese spy balloon off the coast of South Carolina, using the AIM-9X Sidewinder missile manufactured by Raytheon.
Beijing also prohibited the firms from further investment in China, blocked senior management from entering the country, revoked residence permits for any staff in China and imposed penalties that are double the contracted amounts of their arms sales to Taiwan.
Buy Crypto NowIt was not evident how China would implement such fines, which it said must be paid within 15 days.
Last February, China imposed sanctions on two firms over a $100 million arms sale to Taiwan, a self-ruled island which Beijing regards as a breakaway province.
On at least two prior occasions China has made public sanctions against Raytheon and Lockheed a, in 2020 and 2019, though Beijing has not disclose what those sanctions entailed or how they were enforced.
The U.S. does not supply weapons to China. However, the United States is bound by the 1979 Taiwan Relations Act to supply Taiwan with the means to defend itself, and U.S. weapons sales always draw China’s anger.
