China's Ministry of Commerce announced sanctions on Monday against Boeing and two other U.S. defense contractors over arms sales to Taiwan, coinciding with the inauguration of the island's new leader.
This action is part of a pattern of sanctions Beijing has imposed in recent years on defense companies selling weapons to Taiwan, which China views as its own territory.
The sanctions placed Boeing's Defense, Space & Security unit, General Atomics Aeronautical Systems, and General Dynamics Land Systems on an "unreliable entities" list, prohibiting further investment in China and imposing travel bans on the companies' senior management.
Lai Ching-te, Taiwan's new president, has pledged to enhance the island's security by importing advanced fighters and other technologies and by bolstering its domestic defense industry.
In April, China froze the Chinese assets of General Atomics Aeronautical Systems and General Dynamics Land Systems. Corporate records indicate that General Dynamics runs several Gulfstream and jet aviation services in China, which still depends heavily on foreign aerospace technology despite its efforts to develop its own.
General Dynamics also manufactures the Abrams tank, which Taiwan is acquiring to replace older armor in anticipation of potential aggression from China. General Atomics produces the Predator and Reaper drones used by the U.S. military, though it is unclear if these or other weapons are sold to Taiwan.
In 2022, China sanctioned Ted Colbert, president and CEO of Boeing Defense, Space & Security, after the company secured a $355 million contract to supply Harpoon missiles to Taiwan.
The potential impact of these sanctions on companies like Boeing is uncertain. While the U.S. restricts most arms-related technology sales to China, some military contractors also have civilian businesses in aerospace and other industries.
