The New York Stock Exchange is withdrawing plans to remove three Chinese state-owned telecom companies, the exchange said in a statement issued late on Monday, in a reversal of an earlier decision that was undertaken after an order by President Donald Trump that barred Americans from investing in companies deemed to be linked to the Chinese military.
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In its statement, the NYSE said “it no longer intends to move forward with the delisting action” on China Mobile, China Telecom. and China Unicom.
The exchange said the decision was taken after "further consultation with relevant regulatory authorities," but did not offer additional details.
In response to the announcement, China Telecom’s Hong Kong-traded shares rose 3.35% on Tuesday while China Mobile and China Unicom shares surged 5.13% and 8.5% respectively.
All three companies acknowledged the decision in separate investor statements issued to the Hong Kong Stock Exchange stating that they were closely monitoring the situation.
While acknowledging the move, a spokesperson for China’s Foreign Affairs ministry once again accused the U.S. government of "wantonly suppressing foreign companies listed in the country," CNN reported. "We hope the United States will respect the market and rule of law," the spokesperson added.
The NYSE had previously announced plans to delist the three telcos after Trump signed an order in November that prohibited Americans from investing in companies that the U.S. government deemed supporters of China’s military, intelligence and security services. The ban on the trading of these companies’ shares was supposed to go into effect on January 11 and existing investors were given until November to divest their holdings. The move prompted criticism from Beijing which accused the U.S. government of hampering competition by using national security as an excuse.
35. That’s the total number of Chinese companies blacklisted under the November order, according to the Wall Street Journal. The list includes the privately held parents of the three telcos along with China’s biggest chip making, aerospace and technology companies among others.
WHAT TO WATCH FOR
President-elect Biden is expected to continue pressuring China but he will likely rely on a more multilateral approach, forming global alliances to take on Beijing. Biden has promised a greater focus on issues such as intellectual property theft and has said that he plans to use more targetted tariffs compared to Trump. It is unclear, however, if he will make any changes to Trump’s actions on blacklisting Chinese firms that are deemed to have military ties.
NYSE withdraws plans to delist 3 Chinese phone carriers(Associated Press)