China announces sanctions on Lockheed Martin and Boeing over Taiwan weapons sales

China on Monday American companies – including Boeing, Raytheon and Lockheed Martin – will face Chinese sanctions for their role in selling weapons to Taiwan. Speaking at a press conference on Monday, Chinese Ministry of Foreign Affairs spokesperson Zhao Lijian called on US to stop arms sale to the self-governed island and to cut military ties with the administration in Taipei.

The sanctions are the latest episode in the growing escalation ladder between US and China over Taiwan issue. Even though the island has never been under the control of China’s ruling Communist Party, Beijing asserts it is its integral part and has threatened to use force if necessary, to regain its control on the landmass in water.

“We will continue to take necessary measures to safeguard national sovereignty and security interests,” Zhao said. He reiterated the claim that US arms sales to Taiwan “seriously violate” the one-China principle and hits the China’s security interests. The specific details of the sanctions have yet to be announced but Zhao said they will affect “relevant US individuals and entities that played a negative role in the arms sales.”

The spokesperson specifically made a mention the application of sanctions on US industrial giants, Lockheed Martin, Raytheon and Boeing for their role in the trade of arms to Taiwan.

US State Department spokeswoman Morgan Ortagus rejected Chinese decision on Monday night and called it “unproductive.”

The Response from Administration and Companies

“We deplore Beijing’s efforts to retaliate against US and foreign companies for their sales that support Taiwan’s legitimate self-defense requirements, the necessity of which has been made abundantly clear through increasingly hostile incursions by [China’s air force],” she said.

Boeing implicated for its defense contractor business in the crossfire said the issue was one for government to resolve.

“The US government decides on which defense systems to provide Taiwan and then makes the arrangements with the Department of Defense for the provision of such equipment,” a Boeing spokesperson told CNN Business. “Foreign military sales to any country or entity is a direct contractual obligation between the purchaser and the US government/Department of Defense.”

In a similar worded-stance, Lockheed Martin said the foreign military sales are “government-to-government transactions” and maintained that it works closely with American government.

“Lockheed Martin adheres to United States government policy with regard to conducting business with foreign governments,” a spokesperson said. “We do business with more than 70 nations around the world, and all of our international sales are strictly regulated by the US government.”

Raytheon has yet to comment on the recent move by mainland China.

In the past year, Trump administration has made new efforts to enhance its ties with Taiwan including increase in the sale of weapons and resuming high-level meetings between Taipei and United States officials. Last week, WH administration reported the proposed sale of 3 advanced weapons systems to Taiwan in a USD 1.8bn deal. Just hours after Beijing slammed the US corporations with the sanctions, Trump administration informed Congress that it had approved a proposal for a $2.37bn arms sale to Taipei that involved “one hundred Harpoon Coastal Defense Systems.”