China is putting out a warning that it plans to take action if the United States enforces new chip control measures. This comes after reports said the Biden administration could come out with new export procedures by the end of the week.
Reuters reported the U.S. Chamber of Commerce told its members the plan includes adding as many as 200 Chinese chip companies to a trade blacklist which would prevent most U.S. suppliers from shipping to them.
China’s Commerce Ministry spokesperson He Yadong said China strongly opposes what he claims is the U.S. broadening the concept of national security and the “abuse” of control measures targeting Chinese companies.
The U.S. tightened controls on semiconductors over fears that China could use the technology to strengthen its military.
“These actions severely disrupt international economic and trade order, destabilize global industry security and harm the cooperative efforts between China and the U.S.,” Yadong said.
It’s not clear what actions China would take, but Yadong said the country would do what it needed to protect the rights of Chinese companies.
The reported changes are a reversal after the Biden administration signed a bipartisan bill in 2022 providing incentives for chipmakers to set up manufacturing in the U.S., committing $53 billion to boost U.S. competitiveness with China.
The chips are an important component for several products including electronics, vehicles, medical devices and defense systems.
There are also concerns the revitalization of the semiconductor industry will be impacted when President-elect Donald Trump takes office in January 2025.
“That chip deal is so bad,” Trump said on The Joe Rogan Experience podcast in October. “We put billions of dollars for rich companies to come in and borrow the money and build chip companies here.”
Trump said he plans to put up to 60% tariffs on goods from China and a tax of at least 10% on all other imports.
