China sanctions Lockheed Martin, Raytheon over weapons sales to Taiwan

China on Thursday sanctioned Lockheed Martin and Raytheon, two of the largest American defense contractors, over arms sales to the self-governing island nation of Taiwan.

Both companies are prohibited from making new investments in China and engaging in trade and business, the Chinese Ministry of Commerce said in a Thursday statement.

It’s not immediately clear what the impact of the sanctions will be on the arms manufacturers, as the U.S. has already barred the sales of weapons technology to China.

In September, the U.S. announced a $1.1 billion contract for Taiwan that included Harpoon anti-ship missiles and Sidewinder anti-air missiles, as well as a large contract for Raytheon to improve the nation’s radar system.

China has announced sanctions on Raytheon and Lockheed Martin before, including last February, after a $100 million arms sale to Taiwan was announced.

Previous sanctions have been less clear on how Beijing would impose penalties and restrictions on the companies.

The U.S. and China are increasingly strained on the island nation of Taiwan, which Beijing sees as part of the mainland. The ruling communist party has stepped up the rhetoric in recent years on taking back Taiwan, potentially by force.

The U.S. recognizes that Taiwan is a part of China but commits to informal relations with the self-governing nation and is the biggest provider of military weapons and equipment to the island.

The National Defense Authorization Act passed by Congress last year included $10 billion spread out over five years to support Taiwan.

China’s sanctions on the arms manufacturers come just days after the U.S. blacklisted six entities involved in the country’s sprawling spy balloon program.

Tensions between Beijing and Washington have reached new heights after a massive, suspected spy balloon drifted across much of the continental U.S. earlier this month before it was shot down by a fighter jet off the coast of South Carolina.