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Citing security concerns, U.S. cracks down on Chinese companies

President Joe Biden holds a semiconductor before signing an executive order on the economy at the White House in Washington, D.C., on Feb. 24, 2021. (TRIBUNE NEWS SERVICE)
By Ana Swanson New York Times

WASHINGTON – The Biden administration on Thursday stepped up its efforts to impede China’s development of advanced semiconductors, restricting another 36 companies and organizations from getting access to U.S. technology.

The action, announced by the Commerce Department, is the latest step in the administration’s campaign to clamp down on China’s access to technologies that could be used for military purposes and underscored how limiting the flow of technology to global rivals has become a prominent element of U.S. foreign policy.

Administration officials say China has increasingly blurred the lines between its military and civilian industries, prompting the United States to place restrictions on doing business with Chinese companies that may feed into Beijing’s military ambitions at a time of heightened geopolitical tensions, especially over Taiwan.

In October, the administration announced sweeping limits on semiconductor exports to China, both from companies within the United States and in other countries that use U.S. technology to make those products.

It has also placed strict limits on technology exports to Russia in response to Moscow’s invasion of Ukraine.

“Today we are building on the actions we took in October to protect U.S. national security by severely restricting the PRC’s ability to leverage artificial intelligence, advanced computing and other powerful, commercially available technologies for military modernization and human rights abuses,” Alan Estevez, the undersecretary of commerce for industry and security, said in a statement, referring to the People’s Republic of China.

Among the most notable companies added to the list is Yangtze Memory Technologies Corp., a company that was said to be in talks with Apple to potentially supply components for the iPhone 14.

Congress has been preparing legislation that would prevent the U.S. government from purchasing or using semiconductors made by YMTC and two other Chinese chipmakers, Semiconductor Manufacturing International Corp. and ChangXin Memory Technologies, because of their reported links to Chinese state security and intelligence organizations.

The U.S. government added the companies to a so-called entity list that will severely restrict their access to certain products, software and technologies. The targeted companies are producers and sellers of technologies that could pose a significant security risk to the United States, like advanced chips that are used to power artificial intelligence and hypersonic weapons, and components for Iranian drones and ballistic missiles, the Commerce Department said.

In an emailed statement, Liu Pengyu, the spokesperson for the Chinese Embassy in Washington, said the United States “has been stretching the concept of national security, abusing export control measures, engaging in discriminatory and unfair treatment against enterprises of other countries, and politicizing and weaponizing economic and sci-tech issues. This is blatant economic coercion and bullying in the field of technology.”