The on-going US-China trade war keeps intensifying with every passing week. In the latest development, the U.S. State Department has submitted a proposal to add China’s Ant Group to a trade blacklist.
The development was first reported by Reuters, citing two people aware of the matter. However, it is not yet clear when the relevant agency in the government will review the company to determine its addition to the Entity List.
The news comes at a crucial time as the Ant Group is going public and could be worth up to $35 billion with dual lists in Shanghai and Hong Kong. It is reported that the move from the U.S. comes as the China hardliners are seeking to deter U.S. investors from taking part in the initial public offering (IPO).
The Trump officials fear Ant could potentially give the Chinese government access to sensitive banking data belonging to U.S. users. This is the same reason that the U.S. government has been using to ban Chinese companies, without actually offering any proof to back the claim.
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Adding Chinese companies to the Entity List has become the go-to move for the United States government. It started with Huawei in May last year, which has made it very difficult for the company to carry on with its smartphone business.
While the move of adding the company to Entity List has been effective for Huawei, the same move for Ant Group is unlikely to have any substantial effect given that the company has only 5 percent of its business outside of China.
For those who are unaware, Ant Group is the leading mobile payments company in China and offers several services, including loans, payments, insurance, and asset management. Alibaba Group Holding has a 33 percent stake in Ant and the company is controlled by Jack Ma, founder of Alibaba.
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