Last Tuesday, March 25, the United States added dozens of Chinese technology companies to its export blacklist.
It is worth noting that in this case, the first such action was observed against firms from an Asian country after the January inauguration of the President of the United States, Donald Trump. The tightening of measures of interaction between Washington and Beijing in the technological environment is largely a logical continuation of the confrontation between the United States and China watched over the past few years. The process of implementing this confrontation is carried out mainly in the economic plane. The administration of former United States President Joe Biden has restricted the shipments of advanced chips and equipment for the manufacturing of microcircuits of the appropriate category to China. Donald Trump has tightened trade policy measures against the Asian country. These decisions by Washington have contributed to increased tensions between China and the United States. The mentioned moves also have negative consequences for US technology companies, for which the narrowing of the space for operating in the huge Chinese market means significant financial losses. Moreover, there is a high probability that the escalation of tensions between Washington and Beijing will continue.
Restrictions from the United States are narrowing China’s capabilities in terms of artificial intelligence development and access to advanced computing power. Recently, Beijing has been increasingly declaring its commitment to achieving technological sovereignty at the level of official rhetoric. In the context of the current geopolitical tensions, this is what can be called an existential necessity for China, including in terms of economic prospects and positions in the international political arena. At the same time, Beijing has not yet achieved the corresponding goal, which is not impossible or bordering on fantastic visions. The Asian country has sufficient resources and economic and scientific potential for technological sovereignty to become a reality.
The United States Department of Commerce’s Bureau of Industry and Security has added 80 organizations to an entity list, including more than 50 from China. US companies are not allowed to supply their products to firms from the mentioned list without government permits.
The agency stated that the blacklisted organizations were allegedly involved in carrying out activities contrary to the interests of national security and the foreign policy of the United States. Washington is demonstrating its intention to continue restricting Beijing’s access to exascale computing technologies that can process huge amounts of information at very high speeds, and to quantum technologies.
The United States Commerce Department said dozens of Chinese companies have been targeted by restrictive measures due to their alleged involvement in the development of advanced artificial intelligence, supercomputers, and high-performance AI chips for military purposes. Also, in the relevant context, it was separately noted that two firms that were blacklisted supplied sanctioned entities such as Huawei and its affiliated maker microcircuits HiSilicon.
Another 27 Chinese companies were added to the blacklist due to acquiring US-origin items to support the Asian country’s military modernization. The relevant measures also affected seven of China’s firms because of their assistance in developing Beijing’s capabilities in the area of quantum technology.
Among the organizations in the entity list were also six subsidiaries of the Chinese cloud-computing company Inspur Group, which were blacklisted by the Joe Biden administration in 2023.
The Asian country’s foreign ministry on Wednesday, March 26, strongly condemned export restrictions and called on the United States to stop generalizing national security.
Alex Capri, a senior lecturer at the National University of Singapore, stated that the latest expansion of the US blacklist casts an ever-widening net aimed at third countries, transit points, and intermediaries. It was also noted that Chinese companies were able to gain access to strategic dual-use technologies through certain third parties. In this case, loopholes are meant, which allow firms from an Asian country to have access to US technologies, despite restrictive measures.
Alex Capri also stated that United States officials continue to step up tracking and tracing operations aimed at smuggling advanced semiconductors developed by companies such as Nvidia and Advanced Micro Devices (AMD).
The current expansion of export restrictions is most likely not the last. At the same time, it is possible that at some point in the foreseeable future, Beijing and Washington will be able to reach a deal to stabilize the parameters of cooperation.
Against the background of the rapid growth in popularity of the Chinese startup DeepSeek, which operates in the artificial intelligence industry, a large-scale process of the adoption of an open-source low-cost AI model has begun in the Asian country. In this case, a kind of source of pressure has formed on China’s leading technology rivals based in the United States. US companies offer consumers more expensive proprietary artificial intelligence models. DeepSeek has demonstrated the ability to develop high-performance, competitive machine intelligence systems at much lower cost.
The Joe Biden administration implemented a strategy symbolically called Small Yard, High Fence. In this case, strict export control measures are provided, which relate not only to semiconductors but also to some other technological goods, including supercomputers. The approach of the administration of the former President of the United States was to focus monitoring efforts on technologies that have significant military potential. At the same time, in this case, one of the components of the concept was the maintenance of normal economic exchange between Beijing and Washington in other areas. By raising tariffs on goods imported from an Asian country, Donald Trump is changing the condition of trade cooperation between China and the United States.
Jeffrey I. Kessler, Under Secretary of Commerce for Industry and Security, said that the agency is sending a clear, resounding message that the Mr. Trump administration will prevent US technologies from being misused for high-performance computing, hypersonic missiles, military aircraft training, and UAVs (unmanned aerial vehicles) that threaten the national security of the United States. It was also noted that the entity list is one of the many powerful tools available to Washington to identify and cut off foreign adversaries seeking to exploit American technology for malign purposes.
Inspur Group and Huawei did not respond to a request from media representatives for comment on the new restrictive measures by the United States.
US Secretary of Commerce Howard Lutnick said on Tuesday that his department intends to use all the tools at its disposal to ensure the United States’ most advanced technologies stay out of the hands of those who seek to harm Americans.
Zhang Jiadong, a Fudan University professor, expects increased export controls from Washington. In this context, it was noted that the United States is likely to take measures aimed at limiting the space of China’s opportunities when doing business with third countries. Commenting on the expansion of the US blacklist, the professor said that this shows that the United States Department of Commerce is picking up the work again after Donald Trump and Howard Lutnick have taken office. Zhang Jiadong also noted that Beijing is currently reducing the gap from Washington to the technology area. Moreover, the professor stated that Americans have a heightened sense of urgency, so the mentioned tactics will become more intense and frequent.
It is worth noting that Donald Trump has made maintaining the United States’ edge in the area of artificial intelligence one of the central semantic elements of his policy. He pledged to invest $500 million to build a machine intelligence infrastructure in the US. Donald Trump also called the success demonstrated by DeepSeek a wake-up call for the United States industry.
Einar Tangen, a senior fellow with the Taihe Institute, described the expansion of the US export control list as a glimpse of Mr. Trump’s transactional approach to China. In this context, it was noted that the President of the United States imposed some new restrictions to push the Asian country for some sort of deal.
Einar Tangen stated that China has ways to respond to technological limits from the Donald Trump administration and was unlikely to be pushed around by the US.
Chong Ja Ian, a US-China relations specialist at the National University of Singapore, said Beijing may impose export restrictions on major resources and tariff and non-tariff barriers on goods from the United States.
It is worth noting that the Asian country has already retaliated to previous measures to tighten the rules of external technological shipments by the US. In this case, it implies export controls for critical minerals such as graphite and gallium, which are necessary for the production of chips. Also in the current month, China prevented exports of dual-use items for 15 US companies operating in the artificial intelligence industry, and drone makers.
Chong Ja Ian said that the new restrictions may become an impact factor on the prospects of the summit between Donald Trump and the head of the People’s Republic of China Xi Jinping, if neither side wishes to look weak. The mentioned summit is not yet an event that is guaranteed to happen, but it is actively expected and discussed at various levels.
Last week, Donald Trump announced that Xi Jinping would visit the United States in the not-too-distant future. The corresponding statement was made after the media published information about the preparations for the meeting of the leaders of the two countries. At the same time, China has not yet confirmed that Xi Jinping will visit the US. This means that the meeting of the two leaders has not yet been finalized.
Cooperation between Beijing and Washington is what can be described as a mutually beneficial process. At the same time, the present tension between China and the United States may become an obstacle to realizing the corresponding potential. Chong Ja Ian stated the current state of distrust between Washington and Beijing may impede a leaders’ meeting.
