China's Commerce Ministry on Thursday said it put Lockheed Martin Corp (LMT.N) and Raytheon Technologies Corp (RTX.N) onto an "unreliable enterprises list" over arms sales to Taiwan.

The laws forbid Lockheed Martin and Raytheon Missile and Defense Corporation, a subsidiary of Raytheon Technologies, from "participating in import and export activities connected to China," as per a statement from the Ministry.

China sanctioned the two companies in February of last year for a $100 million arms sale to Taiwan.

At the time, China's Foreign Ministry stated that the sale "undermined China's security interests, seriously undermined China-US relations and peace and stability in the Taiwan Strait."

Beijing has repeatedly urged the US to stop selling armaments to Taiwan and cut its military ties with the island. However, the US approved a potential $180 million arms sale to Taiwan in December amid ongoing tensions between the island and Beijing.

This comes less than a week after the US Commerce Department said it added to an export blacklist five Chinese firms and one research institute allegedly linked to Beijing's aerospace programs, including airships and balloons.

The companies include Dongguan Lingkong Remote Sensing Technology Co., Beijing Nanjiang Aerospace Technology Co, and China Electronics Technology Group Corporation 48th Research Institute, AFP reported.

The other three are Guangzhou Tian-Hai-Xiang Aviation Technology Co., Eagles Men Aviation Science and Technology Group Co., and Shanxi Eagles Men Aviation Science and Technology Group Co.

This step comes a day after the US Congress condemned China’s alleged use of what the US described as a "spy balloon" that flew over North America last weekend.

US-China tensions over Taiwan

Washington diplomatically recognizes Beijing over Taipei, but it is also bound by Congress to sell Taiwan weapons to "defend itself".

Former US President Donald Trump increased arms sales to Taiwan during his time in office as he feuded with Beijing on a host of issues from trade to national security. 

Sales included drones, missile systems, and new-generation fighter jets.

It is noteworthy that China considers the island of Taiwan an integral part of its territory and thus has long sought to reincorporate it into the mainland.

Beijing tried to reclaim the island of Taiwan multiple times. Just southwest of Taiwan, Hainan Island, another island that almost matches Taiwan's size extends along the Chinese mainland, and China reincorporated it in 1950.

In a direct reference to the possibility of war, China's Ambassador to the US suggested that the nations may face a "military conflict" over the future of Taiwan.

According to officials, Taiwan has begun deporting Chinese individuals for the first time in more than a year, despite China's repatriation of a Taiwanese fugitive in a rare show of cooperation as tensions escalate.

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