In a significant development, Washington has blacklisted 24 Chinese companies and targeted individuals which helped China’s ruling Communist Party militarize the disputed regions in the South China Sea, in what is the first such step over the strategic waterway.
In a statement, the Commerce Department said, the 24 Chinese companies played a “role in helping the Chinese military construct and militarize the internationally condemned artificial islands in the South China Sea.”
In a separate statement, the U.S. State Department said, it would impose visa restrictions on Chinese individuals “responsible for, or complicit in,” such action and those linked to China’s “use of coercion against Southeast Asian claimants to inhibit their access to offshore resources.”
The companies which have been added to the U.S. Entity List includes Guangzhou Haige Communications Group, several companies that appear to be related to the China Communications Construction Co, Beijing Huanjia Telecommunication, China Shipbuilding Group, Changzhou Guoguang Data Communications, and China Electronics Technology Group Corp.
The latest U.S. moves punishes Chinese military adventurism. In recent months, China has laid claims on lands, including ones with which it has no boundary.
Washington has accused China of militarizing the South China Sea and trying to intimidate its Asian neighbors with an aim to exploit its extensive oil and gas reserves.
In order to assert the freedom of access to international waterways, U.S. warships routinely traverse through these waterways.
China’s embassy in Washington termed the U.S. action as “completely unreasonable,” while urging the United States to reverse them.
“(South China Sea Islands) is an integral part of China’s territory, and it is fully justified for us to build facilities and deploy necessary defense equipment there,” said the spokesperson.
A U.S. defense official speaking on the condition of anonymity said, on Wednesday in yet another sign of Chinese aggression, Beijing launched four medium-range ballistic missiles that landed in the waters of the South China Sea between Hainan Island and the Paracel Islands.
According to a report from Hong Kong-based South China Morning Post newspaper, which cites the Chinese military as saying, Beijing had launched two missiles, including an “aircraft-carrier killer”, into the South China Sea on Wednesday morning.
On Tuesday, a U.S. U-2 reconnaissance plane had flown over Chinese live-fire military drills.
In a statement, the Pentagon said, a U-2 flight had conducted in the Indo-Pacific region was “within the accepted international rules and regulations governing aircraft flights.”
The U.S. trade action comes in the wake of a July statement wherein Washington had said, it would sanction Chinese officials and enterprises involved in coercion in the South China Sea, following Beijing’s expansive claims to offshore resources there as “completely unlawful.”
China has claimed most of the potentially energy-rich South China Sea.
Brunei, the Philippines, Vietnam, Malaysia, and Taiwan also have claims in thr South China sea, through which trade worth $3 trillion passes each year.
“This is the first time the U.S. has levied any type of economic sanction against Chinese entities for behavior in the South China Sea,” said Greg Poling, a South China Sea expert at Washington’s Center for Strategic and International Studies.
“It probably doesn’t make much impact on those entities directly – I doubt that there is much CCCC needs to buy from the U.S. that it can’t get from other suppliers. And these certainly aren’t the financial sanctions that some might have expected … But it could be a start at trying to convince Southeast Asian partners that the new policy is more than just rhetoric.”