Biden to work with Mexico on Chinese investment restrictions

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The Biden administration has reached a new agreement with Mexico aimed at preventing countries like China from investing in North American companies and finding a backdoor into U.S. supply chains.

Why it matters: The accord marks another effort by the Biden administration to keep China from gaining access to U.S. technologies in critical industries.

Driving the news: Yellen announced a formal memorandum of understanding in Mexico City, Mexico where she is meeting with her counterparts on a range of issues.

  • The goal is to help Mexico bolster its screening of foreign investment by sharing information and best practices from the U.S. Committee on Foreign Investment in the United States (CFIUS).
  • “Both countries benefit when they work together to guard against foreign investments that pose national security risks,” Treasury Secretary Janet Yellen said in a statement.
  • “This engagement is further evidence of the close partnership between our two countries, not only on matters of trade but also on critical issues of national security.”
  • For nearly 50 years, CFIUS, composed of U.S. departments and agencies, reviews foreign investment into U.S. companies with the express purpose of protecting national security.

Between the lines: Trade and commerce with Mexico is expected to increase under the Inflation Reduction Act, which included an estimated $400 billion in various clean energy tax credits and subsidies.

  • Companies based in Mexico and Canada, who have free trade agreements with the United States, can benefit from some of the spending.

Zoom out: Over the last three years, the Biden administration has made it a priority to prevent China from gaining a military advantage in critical technologies, like….. Read full article here