PRC Sanctions Lockheed Martin, Raytheon for Taiwan Arms Sales

PRC Sanctions Lockheed Martin, Raytheon for Taiwan Arms Sales
Last updated Feb 16, 2023
Image credit: wsj


  • China placed US-based arms manufacturers Lockheed Martin and Raytheon on its "unreliable entities list" on Thursday, barring the companies from importing goods into China or making new investments in the country.
  • These are the latest sanctions imposed on the companies over their sale of weapons to Taiwan. Raytheon was awarded $412M in September to upgrade Taiwan's military radar, and Lockheed Martin has also supplied the island with radar, helicopters, and air traffic control equipment; the aerospace giant has also helped with fighter jet development.
  • China's past sanctions were less clear regarding penalties for violations, though this time both companies are subject to fines "twice the amount" of their arms sales to Taiwan dating back to 2020. Their senior executives will also be barred from entering and working in China.
  • This comes as the US has already barred sales of weapons-related technology to China, though some military contractors also have civilian aerospace business dealings in the PRC. Lockheed Martin, for example, has sold air traffic control equipment to Chinese civilian airports.
  • China's unreliable entity list is relatively new, having been announced by the state's Ministry of Commerce in 2019 — particularly aimed at combatting the growing US sanction regime — and implementation guidelines released in 2020.
  • US-China tensions have risen in recent years as China has raised its rhetoric around Taiwan. The US officially recognizes the One China policy but is also Taiwan's number one weapons provider.


Pro-China narrative

These sanctions are deserved as both these companies have been advocating for massive weapons shipments to Taiwan, which is a direct threat to Chinese security. Though the US has imposed sanctions on Chinese companies, the punishments against Lockheed and Raytheon may go further than the fine as they lose access to Chinese-based rare-earth elements for manufacturing.

Anti-China narrative

These sanctions are unnecessary as the US has never exported weapons as a means of antagonizing China. Since China and Taiwan split in 1949, the two states have never been the same. The US, as a long-time ally of Taipei, is also obligated by its federal law to maintain economic security with Taiwan, which is why Raytheon and Lockheed Martin conduct both military and commercial aerospace business with the island.

Nerd narrative

There is a 33% chance that China will launch a full-scale invasion of Taiwan before 2030, according to the Metaculus prediction community.

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