Biden administration announces new bans on investments in China meant to protect national security

President Joe Biden's administration detailed new rules Wednesday limiting US investments in advanced technology industries in China in an effort to protect national security at a moment of heightened tension with Beijing.

The new rules would place restrictions on investments by US private equity and venture capital firms, as well as joint ventures, in Chinese artificial intelligence, quantum computing and semiconductors. The rules will be subject to a public comment period.

Long in the works, the new restrictions are meant to prevent American knowledge and money from flowing to China and to tighten the amount of cutting-edge technology available to the Chinese military.

Officials announcing the step repeatedly emphasized their goal was to limit US capital from aiding China's military - not to damage China's economy.

"This is a national security action, not an economic one. We recognize the important role that cross border investment flows play in US economic vitality, and this executive order [is] narrowly protecting our national security interests," one official said in a call with reporters Wednesday.

One critical purpose of the new executive order and forthcoming regulation is about limiting China's access to the "intangibles," like technical know-how or relationships with experts, that often accompany investment from venture capital or private equity firms, a senior official said.

"Ultimately, China doesn't need our money. They're a net capital exporter. So, the thing we're trying to prevent is not money going into China overall, because they have plenty of money, the thing they don't have is know-how," this official said.