Briefing: US lawmaker calls for probe into Chinese state-owned subway car deal

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Schumer asks government to probe rail tech from China – Reuters

What happened: The US Senate Democratic majority leader Chuck Schumer has asked the federal government to investigate whether plans to install new subway cars to the New York City underground system designed by CRRC Corp Ltd, a Chinese state-owned firm, poses a national security threat. A bipartisan bill was introduced to the US House last week that would cut federal funding to transit agencies who secure contracts with the CRCC. The world’s top passenger train maker is eyeing a $500 million deal in the Washington D.C. metro and has secured contracts in Los Angeles, Philadelphia, Boston, and Chicago to provide new subway cars.

Why it’s important: The move comes as tensions escalate in the US-China trade war with both countries increasing tariffs, and just days after the US President placed Chinese telecoms giant Huawei on a trade blacklist, limiting its access to American technology. More than cybersecurity concerns, this move is aimed towards the CRCC’s takeover of the global rail market, which US lawmakers are scrutinizing as a security and economic threat. It won over the US market by aggressively underbidding competitors, and allegedly has its eyes set on the freight market.