China’s Manus block a show of strength ahead of Xi-Trump summit

Beijing’s decision last Monday to block Meta’s US$2 billion acquisition of the Chinese-founded AI start-up Manus came as little surprise. The central government had already flagged its investigation and barred the company’s two founders from leaving the country.

At first glance, the intervention appears disruptive to Chinese firms seeking foreign capital and US companies eyeing investments in China. However, a deeper look reveals this as emblematic of a new normal in China-US business ties, especially in the high-stakes hi-tech sector, where the two powers are locked in intensifying strategic competition. National security and technological self-reliance now routinely supersede commercial deals.

To appreciate the dynamics, reverse the roles. Imagine a high-flying US AI start-up being acquired by a Chinese tech giant such as Tencent. Washington would almost certainly invoke national security reviews and probably block the deal. Beijing’s actions on Manus mirror this logic. In an era of decoupling pressures and export controls, both sides prioritise retaining critical capabilities over open-market principles.