China criticizes US tech squeeze after Washington ramps up export controls
Published: Oct 10, 2022 08:08 PM
The Ministry of Commerce Photo: VCG

The Ministry of Commerce Photo: VCG

The Ministry of Commerce (MOFCOM) on Monday lambasted US technology bullying and urged the US to immediately stop wrongdoings after Washington doubled down on its export controls targeting Chinese companies.

The Bureau of Industry and Security (BIS) of the US Commerce Department on Friday announced the implementation of new export controls on advanced computing and semiconductor manufacturing items to China on the grounds of protecting its national security and foreign policy interests.

The latest update to the US export controls were intended to restrict China's ability to purchase and make certain high-end chips used in military actions, the BIS said.

A chip manufacture machine Photo: VCG

A chip manufacture machine Photo: VCG

The new rule expands the scope of the Export Administration Regulations (EAR) for certain foreign-produced advanced computing items and foreign-produced items for supercomputer end uses.

Simultaneously, the bureau revealed the addition of 31 new Chinese entities to its "unverified list" while removing nine Chinese entities from the list which the bureau claimed had met its requirements.

China has taken note of the issue. First of all, nine Chinese entities were eventually removed from the "unverified list", in the wake of the joint efforts by China and the US. This has been broadly welcomed by Chinese and US businesses, which proves that as long as both sides can hold onto the principles of candid cooperation, mutual benefit and win-win, a solution can be found, a spokesperson from MOFCOM said.

However, the US added 31 Chinese entities to the "unverified list" and moved to intensify its export controls on semiconductors and other areas, the spokesperson noted, saying that such an escalation by the US is a typical act of technology bullying.

The US moves violate and disregard bilateral cooperation, which grossly obstruct normal economic and trade exchanges between Chinese and US firms. The moves also wreak havoc on market rules and the international economic and trade order, and pose serious threats to global supply chain stability, the spokesperson said, voicing China's resolute opposition.

Several Chinese companies issued statements on Tuesday saying that the US' new export control rules would not exert too much impact on their business operation.

A statement issued by Shanghai-based ACM Research noted that the new regulations' impact would be controllable in general and would not exert a substantial influence on the firm's normal operation. The company said it will actively communicate with relevant departments and institutions on the matter.

Hygon Information Technology Co also issued a statement saying that the company's production and operation are normal currently, and being included into the US export control list would not exert a big impact on the company's short-term operation or financial status, but the company needs to make a further appraisal of the long-term impact.

Among the removed names was a subsidiary of contract drug research and development company WuXi Biologics (Cayman) Inc.

In a filing with the Hong Kong stock exchange on Monday, the company said WuXi Biologics Co - one of the subsidiaries - had been taken off the "unverified list" following successful completion of the on-site end-use check visit by the US Commerce Department, in coordination with MOFCOM.

The company said it "remains committed to working with relevant government agencies to remove its other subsidiary, WuXi Biologics (Shanghai) Co," from the list too.

The US acts will not only adversely impact Chinese businesses but also hit the legitimate commercial interests of American exporters, the MOFCOM spokesperson noted, urging the US to immediately stop wrongdoings and treat Chinese firms fairly.

In a stock filing with the Shenzhen bourse on Monday, Zhejiang Dahua Technology Co, a major domestic video surveillance firm, said that the BIS' planned revision of its export control rules and expanded list of entities - which includes Dahua - to be subject to its direct product rules has no major adverse effects on the company.

Since the company was added to an entity list in 2019, it has built a set of mature, secure and reliable management mechanisms for compliant operations and business continuity, per the filing.

In a similarly toned criticism, Foreign Ministry spokesperson Mao Ning told a regular media briefing on Saturday that such practices run counter to the principles of fair competition and international trade rules.

In order to maintain its science and technology hegemony, the US has been abusing export control measures to wantonly block and hobble Chinese enterprises, Mao said.

"By politicizing tech and trade issues and using them as a tool and a weapon, the US cannot hold back China's development but will only hurt and isolate itself," Mao said.

The intensified export controls came after the US Department of Defense's addition of 13 Chinese companies to a blacklist on Thursday, including drone-maker DJI Technology and genomics firm BGI Genomics Co.

Dahua, which was also included in the Pentagon list, said in the Monday filing that the blacklist won't have an impact on its normal operations and the company will continue to maintain adequate and transparent communications with all sides involved as it strives to resolve the list's fallout.

Global Times