Biden blacklists China’s YMTC, crackdowns on AI chip sector

The Biden administration expanded its campaign against China’s semiconductor industry on Thursday by adding the Chinese memory chipmaker YMTC and 21 “significant” Chinese players in the artificial intelligence chip sector to a trade blacklist.

Fears that YMTC could redirect American technology to previously blacklisted Chinese tech giants Huawei Technologies Co Ltd [RIC:RIC:HWT.UL] and Hikvision led to the addition of YMTC to the list (002415.SZ). The action, which was announced in the Federal Register, will prevent YMTC’s suppliers from sending it American goods without a challenging license.

The U.S. government has effectively barred access to technology developed in the United States for the 21 Chinese AI chip businesses, including Cambricon Technologies Corp (688256.SS) and CETC, who are being added to the trade blacklist.

The United States government has effectively blocked access to technology produced anywhere in the world using U.S. machinery for the 21 Chinese AI chip companies that have been added to the trade blacklist, which also includes Cambricon Technologies Corp (688256.SS) and CETC. These companies will face a harsher penalty.

PXW Semiconductor Manufactory Co., a startup chip factory supported by the Shenzhen municipal government and run by a former Huawei executive, was another famous name.

Thea Kendler, assistant secretary of commerce for export administration, said in a statement that “U.S. national security interests necessitate that we act decisively to deny access to advanced technologies” as the Chinese government works to reduce barriers between its military and civilian sectors.

Requests for comment from YMTC, Cambricon, CETC, and PXW did not immediately elicit a response. After being separated from the official think tank China Academy of Sciences in 2016 and going public four years later, Cambricon’s shares plunged 6% on Friday at market open.

The American government, according to the Chinese embassy in Washington, is engaging in “blatant economic coercion and bullying in the realm of technology,” disrupting regular business dealings between Chinese and American corporations and endangering the stability of global supply chains.

It said, “China will steadfastly protect the legitimate rights and interests of Chinese firms and institutions.”

Credit: Rueters