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Manufacture This

The blog of the Alliance for American Manufacturing

Trump, as you might have heard, is rather skeptical of China.

Not so fast.

The Securities and Exchange Commission (SEC) last week extended its review of the sale of the Chicago Stock Exchange to a shady Chinese firm with close ties to China’s government. A bipartisan group of lawmakers — and more than 3,500 Alliance for American Manufacturing supporters — voiced concern over the deal, citing major national and economic security risks.  

The SEC originally set a Jan. 3 deadline for public comments on the rule governing the Chinese takeover of the exchange, The Street reported. But the SEC will now extend the deadline to February or March to conduct “additional analysis.”

The Committee on Foreign Investment in the U.S. already approved the deal. But by extending the review period, the SEC punts the final decision from the Obama administration to the incoming Trump administration — and Trump isn’t exactly known for his fondness of China.

Here’s Michael Wessel, who serves on the U.S.-China Economic and Security Review Commission:

“Rather than burying this in waning days of the Obama administration, this will be reviewed in the beginning of the Trump administration. And Trump, during his campaign, had indicated a much more skeptical view of the U.S.-China relationship.”

Trump also has recruited a trade team that has been willing to stand up for American workers and manufacturers against China, including U.S. Trade Representative pick Robert Lighthizer, Commerce Secretary nominee Wilbur Ross and Peter Navarro, the director of the new White House National Trade Council.

In December, Rep. Robert Pittenger (R-N.C.) — one of the Members of Congress who spoke out against the Chicago Stock Exchange deal — told Crain’s Chicago Business that he thinks the Trump administration “would take a different, maybe more thoughtful approach in their evaluation of Chinese interests.”

The SEC made the right call by punting the deal to conduct further analysis. When the Committee on Foreign Investment in the U.S. gave the sale a thumbs-up in December, we noted how risky the whole thing is.

It’s unclear who actually owns the Chongqing Casin Enterprise Group (CCEG), the firm that wants to buy the exchange, although it’s likely the Chinese government is at least a minority stakeholder. That raises a number of alarm bells, including significant national and economic security risks, especially since companies must provide sensitive data to be listed on the exchange.

At the time, we urged Congress to take action to stop China’s buying spree of U.S. companies, including of the Chicago Stock Exchange. Now that the sale is on hold, we hope the incoming administration will take a serious look at these deals and prevent any Chinese state-owned entity from buying an American company. 

Tell Congress: Stop China's Buying Spree of U.S. Companies

Why in the world would our government allow a Chinese firm likely connected to its government take over the Chicago Stock Exchange?

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