US units of Chinese companies received coronavirus rescue money
WASHINGTON – The US government has provided coronavirus relief loans to several subsidiaries of Chinese companies, including one linked to the Chinese military that has come under scrutiny by Congress, according to data released by the Treasury Department.
Designed to help businesses hit hard by pandemic stay-at-home orders, the Paycheck Protection Program rescue loans included $ 5 million to $ 10 million for Continental Aerospace Technologies Inc., an engine maker of aircraft under the control of Chinese defense giant Aviation Industry Corp. of China, or AVIC, depending on The data of the Treasury Department.
A joint venture of the same Chinese aviation company called Arizona-based Aviage Systems received between $ 150,000 and $ 350,000, according to the data. Aviage is a joint venture between the Chinese AVIC and General Electric Co. which produces avionics equipment.
the Government of the United States also donated between $ 350,000 and $ 1 million to HNA Group North America LLC and HNA Training Center NY LLC, subsidiaries of Chinese conglomerate HNA Group Co., according to the data. The Chinese conglomerate is active in airport services, transportation, real estate, financial services, leasing, tourism, hospitality and logistics.
Bloomberg first reported on loans to subsidiaries of AVIC and HNA.
AVIC, the Chinese airline that controls Continental Aerospace Technologies, was on a Defense Ministry’s list of 20 Chinese companies last month considered to be owned or linked to the Chinese military.
Last month, a bipartisan group of lawmakers called on President Donald Trump to impose economic sanctions on the companies on the list.
In one letter, lawmakers, led by Republican Senator Tom Cotton of Arkansas and Representative Mike Gallagher of Wisconsin, praised the Pentagon for releasing the list and said the United States must counter “parasitic technology transfer efforts ” from China.
When asked about the loans, the Treasury Department and the Small Business Administration did not comment specifically on Chinese subsidiaries and highlighted the general parameters of the PPP loan program. But the Treasury Department spokesman said the government can order a lender to refuse forgiveness of a loan.
The State Department referred the questions to the Treasury Department. The White House National Security Council did not respond to requests for comment.
The loan disclosures come amid mounting tensions between China and the Trump administration, which accused Beijing of initially trying to cover up the extent of the coronavirus outbreak, of trying to hack US research on a COVID-19 vaccine, to steal intellectual property and to commit egregious human rights. violations in Hong Kong and against Uyghurs in the west of the country. China denies the claims.
The rivalry has played out over technology, with the White House pressuring its allies to push back offers of Huawei Technologies Co to provide 5G networks.
The Paycheck Protection Program, established by the CARES Act and overseen by the Small Business Administration, has granted more than 4.9 million loans worth more than $ 517 billion as of July 9. businesses that do not need help. The Trump administration has said the program has been a major success.
The program does not appear to explicitly prohibit US subsidiaries of foreign firms from receiving loans. According to guidelines from the Department of the Treasury and the Small Business Administration, businesses whose primary place of residence is in the United States are eligible for loans.
Some law firms have issued advice online that foreign-invested U.S. companies may be eligible for government assistance.
A US subsidiary of another Chinese company that has raised concerns among US officials, BGI Group, has also received a loan from the program.
BGI Americas Corporation has obtained a ready between $ 350,000 and $ 1 million, according to Treasury Department data. The parent company is building a large genetic database of the Chinese population.
Axios first reported on the BGI loan.
An American startup in Irvine, Calif., CloudMinds Technology Inc., which provides cloud-based “brain systems” for robots, has been awarded a ready from $ 1 million to $ 2 million, according to Treasury data. Reuters first reported on the loan.
In May, the Commerce Department cited several CloudMinds entities as an “excluded list” of organizations “engaged in activities contrary to national security or the foreign policy interests of the United States.”
In one declaration Posted on its website in May, CloudMinds Technology Inc. acknowledged that while some CloudMinds affiliates were added to the list, the list did not include the California-based company.