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South China morning post
The United States blacklists about 60 more Chinese companies, including major chipmaker SMIC and drone maker DJI
The United States added China’s top chipmaker Semiconductor Manufacturing International Corp, among dozens of other Chinese companies, to a trade blacklist on Friday, preventing US firms from selling products to these companies on national security grounds. The Commerce Department announced that some 60 Chinese companies were added. to the so-called list of entities that will require US companies to apply for a license to do business with these companies. “We will not allow advanced American technology to help build the army of an increasingly belligerent adversary,” Commerce Secretary Wilbur Ross said in a statement Friday. Get the latest insights and analysis from our Global Impact newsletter on the great stories originating from China. “Between SMIC’s engaging relationships with the military industrial complex, China’s aggressive enforcement of civil-military merger mandates, and state-led subsidies, SMIC perfectly illustrates the risks of China’s leverage of American technology to support i “Military modernization,” Ross said. Secretary of State Mike Pompeo said Friday that “today’s actions mark yet another sign of our determination” to use “all available countermeasures” to prevent Chinese companies and institutions from “exploding.” US goods and technologies for The SMIC has repeatedly denied any relationship with the Chinese military. These newly added companies joined hundreds of Chinese companies, including telecommunications equipment giants Huawei Technologies Co. and ZTE, which were previously added to the list over national security concerns and alleged violations of U.S. sanctions. Surveillance camera maker Hikvision was previously added over concerns that its products play a role in clamping down on China’s Uygur minority. Boardroom drama at China’s No. 1 chipmaker highlights need for stability Huawei and SMIC, a supplier to Qualcomm and Broadcom, are at the heart of Beijing’s ambition to build class-leading semiconductor and telecommunications industries. worldwide and rely less on American technology. Dominant in the chip industry, its market leadership has declined as companies in Taiwan and South Korea have rapidly increased production. SMIC follows Taiwan Semiconductor Manufacturing Co, the industry market leader, in developing the most advanced chips. It has sought to build foundries for the manufacture of computer chips that can compete with those of TSMC. Adding to the list SMIC, the Shanghai-based state-owned chipmaker, limits the company’s ability to buy key components from US suppliers, Ross said the government would allegedly deny the licenses to prevent SMIC from accessing the technology. to produce semiconductors at advanced technology levels, 10 nanometers or less. Meanwhile, the United States has courted TSMC for years to move its manufacturing facilities to the United States. . The Taiwanese chip maker said in May that it had committed $ 12 billion, some of which will come from US government subsidies, to build a factory in Arizona. However, construction on the plant is not expected to begin until 2021, with the first chips produced in 2024.The announcement was the latest effort by the outgoing Trump administration to cement its legacy of being tough on China. Adding dozens more Chinese companies to the list just weeks before Democratic President-elect Joe Biden takes office also makes it difficult for the new administration to lift these restrictions. The United States adds China’s leading chipmaker and oil giant to the blacklist The implementation of such policies has already been questioned. On Thursday, Senator Marco Rubio, a Florida Republican, sent a letter to the Commerce Department asking the agency to explain why several U.S. companies were granted licenses to continue selling semiconductor products to Huawei after the Chinese company was put on the market. “This is pretending to be tough on China when there is no cost to do so,” said Derek Scissors, a researcher who focuses on US economic relations with Asia at the American Enterprise Institute. “The list of entities doesn’t matter. It didn’t matter before in the Trump administration when the export licenses were granted anyway. It certainly doesn’t matter now, when the Biden administration will determine whether the licenses will be granted.” SMIC was also among the Chinese companies on a separate list announced by the Defense Department earlier this month that will prohibit US investors from investing in these companies because of their alleged ties to the Chinese military. Under that policy, US investors will have to sell their investments in SMIC by the end of next year, essentially separating the Chinese company from US capital. Representatives for SMIC and the Commerce Department did not immediately respond to requests for comment. a total of 77 companies and affiliates on the list of entities, including about 60 Chinese companies that were deemed “contrary to national security or the interests of US foreign policy,” Ross said. Chinese drone giant DJI was also added to the blacklist. a senior Trade official told reporters on a conference call on Friday. Restrictions on US companies from selling to these publicly traded companies take effect immediately, the official said. Huawei to build network equipment factory in France despite 5G restrictions Chinese Foreign Minister Wang Yi said on Friday that the United States should opt for dialogue and consultation with China rather than applying unilateral sanctions. “unacceptable” against Chinese companies. the notion of national security “and” arbitrary suppression of Chinese enterprises “.” We need to replace sanctions with dialogue and consultation, “he said at an Asia Society event on Friday. The United States Department of Commerce said the designations were also aimed at cracking down on Chinese entities that allow human rights abuses. and help build and militarize man-made islands in the South China Sea. The list also included entities that the department said acquired American products in support of People’s Liberation Army programs, and entities and individuals who engaged in stealing secrets. For SMIC, the US government’s moves came at a tumultuous time, as its co-CEO Officer Liang Mong Song suddenly resigned earlier this week. Liang, a TSMC alumnus, had been instrumental in help the growth of the state-backed semiconductor company that leads its team of engineering in a push to develop cutting edge 7nm process technology, which was slated to go. in production in April. SMIC shares fell 5.2% in Hong Kong on Friday and 1.8% in Shanghai. More from South China Morning Post: * MSCI to remove 10 Chinese stocks from its indices after US blacklist * S&P; Dow Jones Indices to delist 21 Chinese companies from its global equities and bonds after US blacklisting * China is Asia’s top military and economic threat – the US chief of commerce. , Wilbur Ross, State Department Says * Hong Kong stocks end week lower after SMIC and CNOOC tumble after US blacklisting Morning Post downloads our mobile app. Copyright 2020.
