Brussels is planning new rules requiring Chinese firms to transfer technology and build factories in Europe to qualify for EU subsidies. These measures will apply to a €1 billion battery development scheme launching in December, potentially setting a precedent for other clean technology initiatives.
The proposals echo China’s own approach to foreign businesses, which compels them to share intellectual property to access its markets. The European Commission has also implemented tariffs on Chinese electric vehicles and stricter rules for hydrogen technology, aimed at reducing reliance on cheaper imports that undercut local manufacturers.
Chinese companies such as CATL and Envision Energy are already investing heavily in European facilities. However, domestic challenges persist, with Sweden’s Northvolt struggling financially as it attempts to scale up battery production. Batteries are critical for electric vehicles, making supply chains essential for Europe’s transition to greener technologies.
Critics warn that these tougher trade policies could disrupt EU climate goals by driving up costs for consumers. While the measures aim to support European industries, experts suggest they risk creating uncertainty and hindering innovation.
President Joe Biden and China’s President Xi Jinping held a two-hour meeting on the sidelines of the APEC summit on Saturday. Both leaders reached a significant agreement to prevent AI from controlling nuclear weapons systems and made progress on securing the release of two US citizens wrongfully detained in China. Biden also pressured Xi to reduce North Korea’s support for Russia in the ongoing Ukraine conflict.
The breakthrough in nuclear safety, particularly the commitment to maintain human control over nuclear decisions, was reported as an achievement for Biden’s foreign policy. Xi, in contrast, called for greater dialogue and cooperation with the US and cautioned against efforts to contain China. His remarks also acknowledged rising geopolitical challenges, hinting at the difficulties that may arise under a Trump presidency. The meeting showcased a shift in tone from their previous encounter in 2023, reflecting a more constructive dialogue despite underlying tensions.
Reuters reported that it remains uncertain whether the statement will result in additional talks or concrete actions on the issue. The US has long held the position that AI should assist and enhance military capabilities, but not replace human decision-making in high-stakes areas such as nuclear weapons control. Last year, the Biden-Harris administration announced the Political declaration on responsible military use of AI and autonomy, and more than 20 countries endorsed the declaration. The declaration specifically underlines that “military use of AI capabilities needs to be accountable, including through such use during military operations within a responsible human chain of command and control”.
A US congressional commission has proposed a bold initiative modeled on the Manhattan Project to accelerate the development of artificial general intelligence (AGI) that could rival or surpass human intelligence. The US-China Economic and Security Review Commission (USCC) emphasised the importance of public-private partnerships to drive technological innovation as competition with China intensifies. However, the panel provided no specific funding plans in its annual report.
Commissioner Jacob Helberg highlighted China’s rapid advancements in AGI, warning of potential shifts in global power dynamics. Addressing infrastructure bottlenecks, he suggested streamlining regulations for data centres as a step to accelerate AI progress. Tech leaders like OpenAI have also advocated for increased government investment in AI to maintain global competitiveness.
Beyond AI, the USCC report included recommendations to tighten trade regulations, particularly by ending the “de minimis” exemption that allows duty-free imports under $800. Commissioner Kimberly Glas underscored the challenge of inspecting the overwhelming volume of such shipments, which she claimed serve as a channel for unregulated Chinese goods, including dangerous materials. Proposals to curb this exemption have sparked bipartisan debate, though legislative progress has been hampered by industry opposition and political gridlock.
Global semiconductor manufacturers are accelerating their shift from China to Vietnam, driven by the anticipated intensification of US sanctions on China’s semiconductor industry, especially with the return of Donald Trump to the White House. South Korean firms, including Samsung Electronics and SK Hynix, are leading this transition, halting production expansions in China and focusing investments on Vietnam, which has become a rising hub for semiconductor production.
SK Hynix, for instance, shelved plans to increase DRAM chip production at its Wuxi plant in China, while Samsung Electronics is cutting back on production at its NAND flash memory facility in Xi’an. Other companies are also following suit; South Korea’s Hana Micron is expanding its presence in Southeast Asia, and Amkor Technology is investing $1.6 billion in a new semiconductor packaging plant in Vietnam. The facility will feature advanced technology, with some equipment reportedly transferred from China.
Vietnam’s semiconductor industry is also benefiting from the growth of companies like Samsung, which established a $1.7 billion OLED plant in the country. Samsung’s semiconductor division is reportedly boosting its investments in Vietnam, encouraging further expansions from supporting companies. Semiconductor testing and packaging firm Signetics is set to invest $100 million in a new facility in Vietnam, and German company Infineon is considering setting up an R&D center in Hanoi.
This shift underscores the ongoing global realignment in the semiconductor industry as companies adapt to geopolitical tensions and US-China trade policies.
T-Mobile‘s network was among those breached in a prolonged cyber-espionage campaign attributed to Chinese intelligence-linked hackers, according to a Wall Street Journal report. The attackers allegedly targeted multiple US and international telecom companies to monitor cellphone communications of high-value intelligence targets. T-Mobile confirmed it was aware of the industry-wide attack but stated there was no significant impact on its systems or evidence of customer data being compromised.
The Federal Bureau of Investigation (FBI) and the US Cybersecurity and Infrastructure Security Agency (CISA) recently disclosed that China-linked hackers intercepted surveillance data intended for American law enforcement by infiltrating telecom networks. Earlier reports revealed breaches into US broadband providers, including Verizon, AT&T, and Lumen Technologies, where hackers accessed systems used for court-authorised wiretapping.
China has consistently denied allegations of engaging in cyber espionage, rejecting claims by the US and its allies that it orchestrates such operations. The latest revelations highlight persistent vulnerabilities in critical communication networks targeted by state-backed hackers.
Europe’s largest tech company, ASML, projected an annual sales growth of 8% to 14% over the next five years, driven by strong demand for its advanced chip-making tools amid a global boom in AI. ASML’s CEO Christophe Fouquet highlighted the company’s advanced EUV technology as pivotal in meeting the growing AI demand, positioning the firm well for continued profitability.
Ahead of its investor day in the Netherlands, ASML forecasted revenue between €44 billion and €60 billion by 2030, with stable gross margins between 56% and 60%, reassuring analysts who had been concerned by recent earnings shortfalls. The company’s shares rose by 2.6% in early trading, buoyed by its steady outlook on AI-driven growth despite weaker demand in other chip segments.
ASML faces challenges in China, where US and Dutch export restrictions prevent it from selling its most advanced EUV and certain DUV tools. However, ASML continues to supply older DUV models to Chinese buyers, even as China’s share of ASML’s total sales has dropped significantly.
Hackers with alleged links to China have stolen sensitive data from US telecommunications firms, targeting information intended for law enforcement agencies. US officials announced the breach on Wednesday, revealing that multiple telecom networks had been compromised. The hackers reportedly accessed call records and communications of individuals in government and political roles, according to a joint statement from the FBI and the Cybersecurity and Infrastructure Security Agency (CISA).
Among the data stolen was information connected to court-ordered surveillance requests made by US law enforcement. The agencies provided limited details about the breach and have yet to disclose the number of companies affected. CISA and the FBI declined to comment further, with additional insights expected as investigations continue.
The incident aligns with earlier reports in the Wall Street Journal, which suggested that Chinese hackers may have infiltrated systems intended for law enforcement to monitor communications. Such claims have led to growing concerns about the security of US telecom infrastructure, particularly given reports of targeted attacks on the phones of high-profile political figures.
The Department of Homeland Security’s Cyber Safety Review Board will investigate the breach, part of an effort to evaluate significant digital security threats. China’s embassy in Washington declined to comment on the latest hacking allegations, which it has previously dismissed as unfounded.
China’s Taiwan Affairs Office has criticised a recent US decision to halt Taiwan Semiconductor Manufacturing Co. (TSMC) from shipping advanced chips to certain Chinese customers. The office’s spokeswoman, Zhu Fenglian, stated that the US is ‘playing the Taiwan card’ to heighten tensions in the Taiwan Straits and that the move negatively impacts Taiwanese businesses. This statement follows reports that TSMC stopped these shipments on Monday after an order from US authorities.
The restricted chips, widely used in AI technology, are part of ongoing US efforts to tighten export controls amid rising bipartisan concerns over Chinese access to advanced tech. The restrictions follow a recent notification by TSMC to the US Commerce Department, revealing that one of its chips was used in a Huawei AI processor. Huawei, a central figure in US-China tech tensions, has been under trade restrictions, requiring suppliers to secure licenses for any technology exports.
Huawei Technologies has called on a US judge to dismiss most of the federal charges accusing the company of conspiring to steal technology secrets from American firms and misleading banks about its business dealings in Iran. In a court filing in Brooklyn, Huawei described the accusations as part of the Department of Justice’s ‘ill-founded’ China Initiative, aimed at prosecuting Chinese entities. The company argued there is no substantial evidence of a conspiracy and that several charges relate to actions outside the United States.
The telecommunications giant contended that the bank fraud allegations rely on a ‘right to control’ theory of fraud, which the US Supreme Court invalidated in a separate case last year. Huawei, which operates globally from its base in Shenzhen with around 207,000 employees, has pleaded not guilty. A trial is set for January 2026. A spokesperson for the US Attorney’s office declined to comment, and Huawei’s legal team did not respond to requests for remarks.
The case dates back to 2018 and led to the high-profile detention in Canada of Huawei’s Chief Financial Officer Meng Wanzhou. Although charges against her were dropped in 2022, the controversy remains a significant chapter in US-China tensions. The China Initiative, under which Huawei was prosecuted, was initiated during Donald Trump’s presidency to curb alleged intellectual property theft by Beijing but was terminated by the Biden administration in 2022 following criticism of racial profiling and the negative impact on research.
The CEOs of Europe’s top three chip manufacturers expressed concerns about the rising nationalist policies from the US, China, and Europe. They argue these policies are pushing each region to secure its own semiconductor supply, causing significant strain on the global chip industry.
Infineon, STMicroelectronics, and NXP—major suppliers of chips for electric vehicles and industrial technology—highlighted the challenges these policies are creating. Speaking at an electronics conference in Munich, Infineon’s CEO Jochen Hanebeck warned that further fragmentation is likely, particularly through tariffs, which could seriously disrupt global supply chains.
STMicroelectronics’ Jean-Marc Chery pointed out that duplicating supply chains across continents has led to costly investments in both materials and engineering. The pressure to maintain regional independence in chip production is placing an unsustainable burden on resources, he noted, particularly as China’s demand for chips in electric vehicles remains strong.
Kurt Sievers, CEO of NXP Semiconductors, argued that no country could feasibly achieve self-sufficiency in the chip industry. Attempting to do so, he said, would lead to prohibitive costs, making electronic devices unaffordable for consumers. He anticipates governments will eventually realise that global cooperation is essential for sustaining the semiconductor industry.
