Tensions are rising between the US and China over semiconductor technology, a report has said. China has threatened to retaliate against potential new US export restrictions where the Biden administration is reportedly planning to unveil curbs on chip-related exports to China and blacklist 200 companies.
According to a report by news agency Reuters, the Chinese commerce ministry has responded to these reports. Spokesperson He Yadong expressed strong opposition to the US expanding its definition of national security and its “abuse” of export controls targeting Chinese companies.
He argued that these actions disrupt the global trade order, destabilise industrial security, and harm cooperation within the semiconductor industry.
“These actions severely disrupt the international economic and trade order, destabilise global industrial security, and harm the cooperative efforts between China and the US, as well as the global semiconductor industry,” He said.
“If the U.S. insists on escalating control measures, China will take necessary actions to resolutely protect the legitimate rights of Chinese enterprises,” he added.
US plans to blacklist 200 Chinese chip companies
The US Chamber of Commerce recently alerted its members that the administration is considering blacklisting up to 200 Chinese chip companies, effectively cutting them off from most US suppliers.
The US has been tightening its grip on semiconductor technology due to concerns that China might use advanced chips to bolster its military capabilities.
Bloomberg reported that the proposed restrictions would include curbs on semiconductor equipment and AI memory chips. However, the latest proposal appears to be less severe than initially anticipated, with fewer Huawei suppliers targeted and ChangXin Memory Technologies, a key player in AI memory chip development, reportedly excluded from the blacklist.
The restrictions would still impact two chip factories owned by Semiconductor Manufacturing International Corp (SMIC), a Huawei partner, and over 100 Chinese companies involved in producing semiconductor manufacturing equipment.
Why China’s problems may increase
While the decision on the reported curbs is taken by the Biden Administration, which is due to change in January. There are concerns that President-elect Donald Trump’s promise to implement additional tariffs on China could trigger a trade war, Reuters said.
Trump has said that his administration will impose an additional 10% tariff on all imports from China, above any existing tariffs.