China to cut ties with US firms that sell arms to Taiwan

An Iraqi soldier with a shoulder-launched anti-aircraft Stinger missile system. (AFP pic)

BEIJING: China’s government and companies will cut business ties with US firms involved in selling arms to Taiwan, China’s foreign ministry said on Monday.

Ministry spokesman Geng Shuang made the comments at a daily news briefing in Beijing. He declined to specify which companies would be affected.

The decision follows a threat from Beijing to impose sanctions on US firms involved in a deal to sell US$2.2 billion worth of tanks, missiles and related equipment to Taiwan.

Last week, the Pentagon said the US State Department had approved the sale of the weapons requested by Taiwan, including 108 General Dynamics Corp M1A2T Abrams tanks and 250 Stinger missiles, which are manufactured by Raytheon.

On Sunday, the ruling Communist Party’s official People’s Daily posted an article on its WeChat account identifying US companies that could be vulnerable to sanctions.

They included Honeywell International Inc, which makes the engines for the Abrams tanks, and private jets maker Gulfstream Aerospace, which is owned by General Dynamics. China is an important market for both Honeywell and Gulfstream.

Ties between China and the United States are already strained over a trade war, which has seen them levy tariffs on each other’s imports, although they are trying to resolve that dispute.

The United States adheres to a “one-China” policy, officially recognising Beijing and not Taiwan, which Beijing regards as a renegade province.

The United States has no formal ties with Taiwan but is bound by law to help provide it with the means to defend itself.