Taylor said some of Trump's Trump's advisors like Secretary Mnuchin would prefer a holistic approach, going after all countries that the US believes are attempting to unfairly acquire American technology. "Trump's action suggests that Mnuchin has won the day, for now," he said.

Commenting on Trump's remarks, Cornell University economist Eswar Prasad said, "This suggests that some rationality might be returning to the approaches on trade and investment restrictions," according to a WSJ report. "But it doesn't necessarily signal a pullback from [a] hard-line stance on China."

Late last month, the Trump administration issued a statement saying that the US will implement "specific investment restrictions and enhanced export controls" for Chinese acquisition of industrially significant technology.

Specifics of the new investment limits are scheduled to be announced by Friday.

The Chinese Ministry of Commerce said it had taken note of the US news report about the proposed investment restrictions.

"We are paying close attention to it, and will assess the potential impact on Chinese companies," the ministry said in a statement on Wednesday, Beijing time.

On Monday, the Foreign Ministry said Chinese investment has created jobs while increasing tax revenues in the US.

"China-US trade, investment and cooperation are mutually beneficial in nature," Foreign Ministry spokesman Geng Shuang said at a regular news conference. "We hope the US can view Chinese companies' commercial activities in an objective way, and provide a fair, sound and predictable investment environment."

Acquisitions and greenfield investments from China are projected to trickle to $1.8 billion in the first half of this year, a drop by more than 90 percent compared with the same period last year, the lowest level in seven years, according to Rhodium Group LLC, a New York-based research firm.

Foreign direct investment from China to the US plummeted 30 percent in 2017 compared to a record high in 2016, according to the 2018 Annual Business Survey Report on Chinese Enterprises in the United States released by the China General Chamber of Commerce – USA last Wednesday.

Speaking at a reception that released the survey, US Secretary of Commerce Wilbur Ross said investment from Chinese-affiliated companies has amounted to $73.4 billion in the US, and the companies directly employed 77,000 Americans.

"Increasingly, these companies are exporting goods back to China. This is a positive trend that can help address the bilateral trade deficit between our countries," Ross said.

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