United States President Joe Biden, on August 9, issued an executive order that will restrict new American technology investments in China in crucial areas of computer chips and demand government authorization for investments in other such industries.

The order aims to address the threat to national security by prohibiting American investments in countries of particular concern. Along with the People’s Republic of China (PRC), the order lists the Special Administrative Region of Hong Kong and the Special Administrative Region of Macau, as a countries of concern.

According to the White House, the signed order also grants the U.S. Treasury secretary the power to forbid or limit American investments in Chinese companies across three industries—semiconductors and microelectronics, quantum information technology, and specific artificial intelligence systems.

"This program will seek to prevent foreign countries of concern from exploiting U.S. investment in this narrow set of technologies that are critical to support their development of military, intelligence, surveillance, and cyber-enabled capabilities that risk U.S. national security," a statement by the White House noted.

“The Biden Administration is committed to keeping America safe and defending America’s national security through appropriately protecting technologies that are critical to the next generation of military innovation. This narrowly targeted action will complement our existing export control and inbound investment screening tools, and protect our national security while maintaining our longstanding commitment to open investment,” the Treasury department maintained.