China vows response to US chip restrictions

China has issued a strong warning against potential new US export restrictions on semiconductor technology, signalling it could take ‘necessary actions’ to safeguard its firms. The warning follows reports suggesting the Biden administration may expand its trade blacklist, potentially adding up to 200 Chinese chip companies to the list. Such measures would limit US suppliers from trading with these firms.

Chinese commerce ministry spokesperson He Yadong condemned the US for what he described as overreach in the name of national security. He argued the proposed controls destabilise global trade and harm bilateral cooperation in the semiconductor sector. He emphasised China’s determination to defend its companies’ rights if the US persists with its actions.

Reports indicate that the Biden administration is mulling restrictions on semiconductor equipment and AI memory chip sales to China. These measures may target firms like Semiconductor Manufacturing International Corp., a Huawei ally, while sparing ChangXin Memory Technologies, a rising AI memory chip developer.

The tensions come as the outgoing Biden administration faces domestic and international scrutiny over trade policies. Meanwhile, there is concern that President-elect Donald Trump’s proposed tariffs on Chinese goods could further inflame trade relations, with Beijing warning that such measures would fail to address US domestic issues effectively.