And BIS aims to keep things that way: Its controls will block Chinese purchases of even years-old chip-making equipment and prevent American personnel from providing support or know-how. China’s own semiconductor sector is incapable of producing the leading-edge chips used in AI applications. Among other consequences, this will hamstring the development and deployment of artificial intelligence (AI) throughout the country-hindering Chinese progress in e-commerce, autonomous vehicles, cybersecurity, medical imaging, drug discovery, climate modelling, and much else. ![]() Advanced semiconductors from any country will be presumptively denied to every Chinese company, even firms lacking direct ties to Beijing’s military or intelligence services. They effectively bring all of China under the special rule formerly reserved for Huawei. The new export controls, however, are different. These earlier restrictions were provocative in their time, but they reflected at least some sense of proportion. Leading-edge chips were off limits, while less advanced chips were allowed. By leveraging America’s centrality in the global chip supply chain, BIS forced semiconductor designers and manufacturers in third countries to limit sales to Huawei. export controls primarily apply to U.S.-origin items, but the foreign direct product rule extends the scope to cover non-U.S. export controls greater extraterritorial reach. BIS targeted Huawei with an expanded form of its “foreign direct product rule,” a powerful regulation that grants U.S. One Chinese company, Huawei, has faced a unique, supercharged version of the Entity List. Even so, BIS exercised its discretion to license large amounts of nonsensitive exports to listed companies. Leading Chinese chip companies, supercomputing organizations, and software and hardware vendors have all landed on the list. The number of unique Chinese companies on this list quadrupled, from 130 to 532, between 20. Chief among these is the Entity List, which bars designated firms from importing U.S. measures have limited the flow of technology to and from China in recent years. To understand the strategy behind these new controls, it helps to look at what preceded them. China’s technological rise will be slowed at any price. The pace and details are uncertain, but the strategic objective and political commitment are now clearer than ever. measures to come, not only in advanced computing but also in other sectors (like biotech, manufacturing, and finance) deemed strategic. More cautious voices-technocrats and centrists who advocate incremental curbs on select aspects of China’s tech ties-have lost. In short, America’s restrictionists-zero-sum thinkers who urgently want to accelerate technological decoupling-have won the strategy debate inside the Biden administration. government imposed the new rules after limited consultation with partner countries and companies, proving that its quest to hobble China ranks well above concerns about the diplomatic or economic repercussions. Although framed as a national security measure, the primary damage to China will be economic, on a scale well out of proportion to Washington’s cited military and intelligence concerns. action, reveal a single-minded focus on thwarting Chinese capabilities at a broad and fundamental level. The controls, more so than any earlier U.S. ![]() The Bureau of Industry and Security (BIS) announced new extraterritorial limits on the export to China of advanced semiconductors, chip-making equipment, and supercomputer components. Last Friday, however, a dense regulatory filing from a little-known federal agency gave the strongest hint yet of U.S. goals have remained hidden beneath bureaucratic opacity and cautious platitudes. Joe Biden’s actions have been more systematic, but long-term U.S. Does it seek to compel specific changes in Beijing’s behavior, or challenge the Chinese system itself? To protect core security interests, or retain hegemony by any means? To strengthen America, or hobble its chief rival? Donald Trump’s scattershot regulation and erratic public statements offered little clarity to allies, adversaries, and companies around the world. But Washington’s endgame for this conflict has always been hazy. The United States has waged low-grade economic warfare against China for at least four years now-firing volley after volley of tariffs, export controls, investment blocks, visa limits, and much more.
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