Every electronic device we own and use on a daily basis has chips inside. This hardware piece basically acts as a brain and heart, and without it, these devices would be useless. This is why this technology is so crucial, and it’s also why US President Donald Trump wants to further curb China and its access to these chips.
Restricting China’s access to chips
According to reports, the Trump administration is looking to expand semiconductor restrictions on China. These restrictions were part of the Biden administration’s efforts to limit China’s technological advances and cripple the country’s ability to develop chips of its own. Trump had already imposed 25% tariffs on foreign-made semiconductor chips, but this report suggests that he plans to lean further into these restrictions.
So much so that Trump officials have met with their Japan and Dutch counterparts to discuss these restrictions. Trump is hoping to pressure US allies and their companies, such as Tokyo Electron and ASML, from maintaining semiconductor equipment in China. These restrictions are similar to those placed by China on American companies like Lam Research, KLA, and Applied Materials.
Trump isn’t stopping there, either. Officials are also looking to impose stricter export limits on NVIDIA’s AI chips that are designed specifically for the Chinese market. The Biden administration had previously banned the export of high-end AI chips to China. NVIDIA developed downgraded versions of its chips to skirt around these restrictions. However, the report suggests that Trump wants to place even stricter restrictions.
Sanctions on Chinese companies
In addition to restricting China’s access to chips, Trump’s team is looking to impose new sanctions on Chinese companies. One of the firms that could be caught in the crossfire is ChangXin Memory Technologies. The Biden administration had considered sanctioning the company and preventing it from buying American technology. However, this did not come to pass due to opposition from Japan.
Another company that Trump could be looking to further restrict is SMIC. For those unfamiliar, SMIC is the company behind Huawei’s recent chipsets. Imposing restrictions on SMIC could greatly hinder Huawei’s development. At one point, Huawei seemed likely to overtake both Apple and Samsung in the smartphone market. However, the company’s ambitions came to a screeching halt when the US placed it on the Entity List.
That being said, the report does not mention when these new regulations will take effect. Trump is still in the process of filling key federal positions. Plus, it is unclear whether American allies from Japan and the Netherlands will fully cooperate with these policies.
