The US government is strengthening China export bans on chipmaking devices

Alfonso Maruccia

Posts: 27   +14
Staff
Cutting corners: Washington is preparing new rules to ban exports of advanced chipmaking devices to China, a move that could, however, be too little too late as Asian manufacturing companies are already engaged in making sub-14nm semiconductors on their own.

The Biden administration is preparing new, harsher restrictions against the chipmaking industry in China. After a series of so-called "is informed" letters sent earlier this year to a few US companies, the Commerce Department now plans to turn these individual letters into a broader message to China: we won't let you exploit our superior computer technology and know-how for your own gain.

The letters were sent to KLA Corp, Lam Research Corp and Applied Materials Inc., and they were later confirmed to be authentic. The US Department of Commerce ordered the three companies to stop the export of chipmaking machines and equipment needed to make semiconductor components with sub-14 nanometer processes to China. Only sellers that obtained a proper export license from Washington should keep doing business with Beijing.

The new ban could join those already imposed to Nvidia and AMD over sales of high-performance AI accelerators and GPUs; even worse, at least from China's point of view, the letters will likely be codified in new rules from the Commerce Department destined to affect the entire US semiconductor industry.

Washington makes use of "is informed" letters to avoid the lengthy rulemaking process and to impose new controls faster, but the restrictions only apply to companies that receive the letter.

The prospect of new export limits is being discussed and actively monitored by Intel and Cerebras Systems, both involved in the production of the similar AI accelerators as sold by Nvidia and AMD. OEM companies like Dell, HPE and Supermicro, are also interested in the new rules as they sell servers equipped with Nvidia's A100 Ampere GPU.

While the government's official position hasn't been revealed yet, a senior official stated that, "as a general rule," the Commerce Department looks to "codify any restrictions that are in is-informed letters with a regulatory change." The Biden Administration plans to "choke off" China in their ability to make advanced computing technology without external aid, but the effort could be pointless as the Asian semiconductor giant SMIC has seemingly already been able to produce chips with a 7nm manufacturing process.

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Watzupken

Posts: 671   +544
I feel the actions of the administration is very ironic. On one hand, they said they are trying to build their relationship with China (that's before the relationship turned even more sour after the Taiwan visit), on the other hand, they are sanctioning the same nation they claim that they are building a relationship. Don't sound very "relationship building" in my humble opinion.
 

umbala

Posts: 690   +1,252
The administration is sanctioning. Why is it OK for this administration to do so but was found horrible when the previous admin did it?
You're comparing apples to oranges. It's one thing to sanction China in the name of national security, but quite another to sanction them as punishment because they wouldn't do what the Orange Conman was demanding.
 

acoustis

Posts: 12   +6
Another apples to oranges comparison: these smart guys look like kindergarten kids.

I mean in the wider view of things we are all aware that working together brings much better results. And keeping some things for themselves is always only temporary boosting ego for the holder. In the end this blocks relationships, thus blocking progress on a larger scale. It's always two edged sword and always cuts back.
 

dangh

Posts: 680   +1,071
But the main chip make devices are coming rom Europe afaik. Really, this approach have no sense, unless US is trying to help China in getting even more independent and self-sustained country.
Focus on bringing Taiwan to the maps as the separate country and work on the democracy. US loves to take Chinese money and resources, but this is really short-sighted approach.
 

winjer

Posts: 458   +2,104
The administration is sanctioning. Why is it OK for this administration to do so but was found horrible when the previous admin did it?

You seem like and older person, so one would have expected you would have caught on sooner.
But everything the Democrats do is criticized as bad by the Republicans and vice-versa.
It has always been this way and it will always be this way in politics.
 

Endymio

Posts: 1,828   +1,895
It's one thing to sanction China in the name of national security, but quite another to sanction them as punishment because they wouldn't do what the Orange Conman was demanding.
How dare a US President demand China stop threatening Taiwan, stealing industrial and military secrets, and spying on US citizens!
 

Uncle Al

Posts: 9,096   +8,132
Once again too little, too late. With China's track record to stealing US technology the US would do well to start tightening the screws on China to the point they finally give in and at the same time strongly encourage companies like Walmart, etc. to buy other than China and require them to verify and certify the goods they get where not sold through a 3rd party (from China). We've seen first hand the success of these measures against Russia .... sooooooo .....
 

RudyBob

Posts: 708   +670
You seem like and older person, so one would have expected you would have caught on sooner.
But everything the Democrats do is criticized as bad by the Republicans and vice-versa.
It has always been this way and it will always be this way in politics.
This is not a case of that. You will learn if you pay attention and think for yourself. I am not an older person I am an old person
 

kira setsu

Posts: 355   +309
"our superior computer technology"

dont the actual machines come from a company in europe though? cause if the US isnt making the machines and theyre doing all in their power to stop china from getting one then it seems to me china is gonna just end up building one from scratch.
 

wiyosaya

Posts: 7,964   +7,007
The administration is sanctioning. Why is it OK for this administration to do so but was found horrible when the previous admin did it?
The previous administration did it? I really think you are misinformed about the effect of the previous administration's "Tariff War" on China. US citizens were paying those tariffs, not China. Unlike the previous administration's efforts, this administration's efforts actually have Teeth that bite China - not US citizen's wallets.
 
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wiyosaya

Posts: 7,964   +7,007
I feel the actions of the administration is very ironic. On one hand, they said they are trying to build their relationship with China (that's before the relationship turned even more sour after the Taiwan visit), on the other hand, they are sanctioning the same nation they claim that they are building a relationship. Don't sound very "relationship building" in my humble opinion.
I think that the goal of this is to return manufacturing back to the US since the big tech companies won't do that as it will affect the big tech companies race to the bottom of ever cheaper prices in the name of providing the big tech company's customers with ever cheaper materialistic crap and the big tech company's shareholders with ever increasing profits.
 

Endymio

Posts: 1,828   +1,895
really think you are misinformed about the effect of the previous administration's "Tariff War" on China. US citizens were paying those tariffs, not China.
Oops! If US consumers "paid those tariffs", why did prices not rise? Here's what happened after Trump's latest round of China tariffs:

"Tariffs have not pushed up consumer prices....The consumer price index rose just 0.1 percent in May, the Department of Labor said Tuesday....After taking out volatile food and energy prices, inflation ran at 0.1 percent for the month and 2.0 percent for the year, both below economist expectations...."

Even the far-Left anti-Trump Washington Post agreed:
"Trump’s China tariffs have not caused Americans to pay $1,000 more a year....The evidence so far indicates that most American firms passed only a fraction of the cost increase on to consumers — more in the range of $100 per family a year...

The fact remains that Trump's tariffs brought about the first ever decrease in the China trade deficit in US history:

"The US trade deficit with China has dropped sharply since former president Donald Trump launched a tariff war against Beijing in 2018

The trade in goods deficit with China fell to US$310.8 billion in 2020, down from US$419 billion in 2018, when the tit-for-tat trade action started, according to US data released on Friday, reflecting action on pledges that Beijing made in a phase one trade deal that Trump signed with Chinese Vice-Premier Liu He in Washington a little more than a year ago....

The 26 per cent drop in the bilateral trade gap over two years compares with a more modest 10 per cent decline since 2016, when Trump was campaigning for the White House with a pledge to reverse US deficits with China...


 

OortCloud

Posts: 799   +784
It's a start. The Western World needs to stop trading with China at all until the totalitarian regime is gone. I used to think that opening up to countries like these would eventually encourage them to change, but recent events have shown they have just become bolder, wealthier and more aggressive and continue to flout civil rights. So the West needs a major rethink of their ties.
 

Ryan Barrett

Posts: 53   +13
You're comparing apples to oranges. It's one thing to sanction China in the name of national security, but quite another to sanction them as punishment because they wouldn't do what the Orange Conman was demanding.

And yet Biden hasn't rolled those tariffs back. 25% is ridiculous and continue to make prices go up on everything from GPUs to Cars (aside from the chip shortage). I thought Biden would have rolled that back shortly after taking office, but no...
 

RudyBob

Posts: 708   +670
The previous administration did it? I really think you are misinformed about the effect of the previous administration's "Tariff War" on China. US citizens were paying those tariffs, not China. Unlike the previous administration's efforts, this administration's efforts actually have Teeth that bite China - not US citizen's wallets.
On a technicality sanction vs tariff. It was not a tariff war it was jobs and US independence. I would support that any day over sending money to __________________________