The latest blow: A U.S. report that says telecom equipment makers Huawei Technologies Inc. and ZTE Corp. are potential security threats that Americans should avoid doing business with.
The report comes amid an American presidential race in which trade tensions with Beijing are a prominent issue.
It highlights conflicting U.S. sentiments toward China - an important trading partner but a potential strategic rival.
U.S. companies see China as both a crucial growth market and a source of competition and industrial spying.
Huawei and ZTE rejected the security threat accusation and complained the committee failed to provide evidence to back it up.
(Copyright 2012 by The Associated Press. All Rights Reserved.)