In response to the US Department of Defense listing Alibaba, Baidu, and several other Chinese companies in its 'Chinese Military Companies List', indicating that these companies are linked to the Chinese military, China’s Ministry of Commerce has warned that it will 'take firm and powerful countermeasures.'
The Pentagon announced the list less than a month after US President Trump’s visit to China and meeting with Chinese President Xi Jinping, putting the consensus to build a 'constructive strategic stable relationship' between the two countries to the test.
According to interviewed scholars, it is highly likely that China will implement countermeasures; the future direction of Sino-US relations is that both parties will 'stably not cooperate' in the security field, while 'stably cooperating' in non-security fields.
The US Department of Defense published an updated list of 'Chinese military-industrial companies' on June 8 in the Federal Register, pursuant to Section 1260H of the National Defense Authorization Act. The number of entities on the list increased from last year’s 134 to 188. Chinese tech companies, new energy vehicle companies, and biotech firms such as Alibaba, Baidu, BYD, NIO, WuXi AppTec, Unitree Robotics, and RoboSense are all included, as are CXMT and YMTC, which had previously been removed.
Alibaba, Baidu, and WuXi AppTec have already denied the US Department of Defense’s claims, saying they have not participated in any civil-military fusion strategies and are by no means Chinese military companies.
With this update, the US has now placed all three leading Chinese tech giants—Alibaba, Baidu, and Tencent—on the list of entities supporting the Chinese military.
According to Reuters, the list itself does not constitute immediate sanctions. However, under US law, the Pentagon will be prohibited from signing contracts directly with the listed companies. From 2027, this will expand to prohibit the Department of Defense from purchasing these companies' products or services even via third parties. Bloomberg notes that this move by the Pentagon may foreshadow harsher trade restrictions.
The US Department of Defense published an updated list of 'Chinese military-industrial companies' on June 8 in the Federal Register, pursuant to Section 1260H of the National Defense Authorization Act. The number of entities on the list increased from last year’s 134 to 188. Chinese tech companies, new energy vehicle companies, and biotech firms such as Alibaba, Baidu, BYD, NIO, WuXi AppTec, Unitree Robotics, and RoboSense are all included, as are CXMT and YMTC, which had previously been removed.
Alibaba, Baidu, and WuXi AppTec have already denied the US Department of Defense’s claims, saying they have not participated in any civil-military fusion strategies and are by no means Chinese military companies.
With this update, the US has now placed all three leading Chinese tech giants—Alibaba, Baidu, and Tencent—on the list of entities supporting the Chinese military.
According to Reuters, the list itself does not constitute immediate sanctions. However, under US law, the Pentagon will be prohibited from signing contracts directly with the listed companies. From 2027, this will expand to prohibit the Department of Defense from purchasing these companies' products or services even via third parties. Bloomberg notes that this move by the Pentagon may foreshadow harsher trade restrictions.
Following the Chinese Foreign Ministry, China’s Ministry of Commerce also expressed 'strong dissatisfaction and firm opposition' to the latest actions by the Pentagon via its website on Saturday (June 13).
A ministry spokesperson accused the US of ignoring the consensus reached by the two heads of state in Beijing, disregarding the overall framework of Sino-US economic and trade relations, continuously broadening the definition of national security, and abusing state power to unreasonably suppress Chinese companies. The spokesperson also said the US is severely undermining international economic and trade order, endangering the stability of global supply chains, and seriously damaging the legitimate rights and interests of Chinese enterprises.
The spokesperson also urged the US to immediately stop its 'erroneous actions,' immediately revoke the related measures, and return to the correct track of building a constructive strategic stable US-China relationship; otherwise, 'China will resolutely and forcefully retaliate, and all resulting consequences and responsibilities will be borne by the US side.'
Luo Minghui, Associate Professor of Public Policy and Global Affairs at Nanyang Technological University, Singapore, judges that Beijing is highly likely to implement countermeasures.
He analyzed that China has three main tools at its disposal: first, adding more US companies to the unreliable entities list, mostly targeting US firms Beijing deems as participating in military-civil fusion strategies; second, invoking the 'Anti-Foreign Sanctions Law' to issue prohibition orders against organizations and individuals executing or assisting in implementing foreign 'improper extraterritorial measures'; and third, further tightening export controls on rare earth materials, which would be the most drastic countermeasure.
Luo further analyzed that this event highlights the difficulties in building a constructive strategic stable relationship between China and the US, rooted in their differing interpretations of the concept. In China’s view, constructive strategic stability means the other side will not take actions that harm its own interests; while the US sees constructive strategic stability as not precluding competition, as long as competition does not damage the broader bilateral relationship.
He said that both China and the US have, in recent years, shown increasing tendencies toward 'securitization,' and are unyielding when it comes to issues of national security. This makes it even harder to maintain a constructive strategic stable relationship, but single incidents are not enough to collapse the framework.
Shen Dingli, an international relations scholar in Shanghai, believes that a constructive strategic stable relationship 'is just rhetoric.' The US has already decided to completely decouple from China in areas potentially involving security. The future of US-China relations is likely to be 'stable non-cooperation' in the security field, and 'stable cooperation' in non-security fields. 'Constructive' means that even as competition continues, both parties must still avoid military conflict.
He also said that the latest US move will have substantive impacts on the Chinese companies listed. Whether Beijing retaliates depends on whether China is willing to double down on blocking mutual cooperation.
Shen also assessed that the upcoming meeting between the heads of state of China and the US should not be affected. 'Non-cooperation is the norm. Even if not cooperating, they still have to interact, otherwise the consequences would be even more severe.'