Leaders of a congressional commission on China asked Intel and Nvidia to explain whether they knew their technology exports to China would help the government conduct mass surveillance of Muslim minorities and eventually lead to human rights violations. In Dec. 4 letters, Rep. James McGovern, D-Mass., and Sen. Marco Rubio, R-Fla., chair and co-chair, respectively, of the Congressional-Executive Commission on China, said they are concerned that sales of the companies’ computer chips are helping to power a Chinese supercomputer being used to suppress minorities in the Xinjiang region, The New York Timesreported Nov. 22.
Cordell Hull, who has led the Bureau of Industry and Security for the last year (see 1911180040), will resign next month ahead of the incoming Joe Biden administration. His last day will be Dec. 4, a BIS spokesperson said. “I am proud of what we have achieved on important issues of national security at BIS and I have decided to look for the next challenge in the private sector,” Hull said in a Nov. 19 statement. “I am grateful to Secretary [Wilbur] Ross for giving me this opportunity to serve.”
When the Joe Biden administration takes office, it will likely continue the Commerce Department's emphasis on export controls and entity listings to stay ahead in technology competition with China, said Eric Sayers, an Asia-Pacific policy expert with the Center for a New American Security. Although both tools have been heavily used by the Trump administration, Biden might do more to convince allies to also impose those restrictions, especially as the U.S. fights to maintain commercial leadership in the semiconductor sector, Sayers said.
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, will no longer lead the committee even if Republicans retain the majority in the Senate. The Republicans have term limits for committee chairmanships, so he will move on. Sen. Mike Crapo, R-Idaho, is the most senior member of the committee, and thus is the next expected chairman, though that move has not yet been settled.
In a think tank effort that seems to assume a change in Washington, though never explicitly says it, the Peterson Institute for International Economics says there should be a return to more conservative use of export controls and entity lists to manage the threat of Chinese access to advanced technology for nefarious purposes. Martin Chorzempa, a PIIE research fellow, discussed a memo he authored to a future Commerce undersecretary for export controls in the next administration, during an Oct. 22 webinar at PIIE.
The U.S. should sign a trade deal with Taiwan and increase cooperation on export controls, similar to U.S. partnerships with Japan and Australia, Asia experts at the Center for Strategic and International Studies said. Increased collaboration with Taiwan has strong support from Congress and the Taiwanese government, the experts said, and would make sense as the U.S. welcomes manufacturing and investment from Taiwan.
The Commerce Department informed some U.S. chip companies they need export licenses before shipping certain items to Semiconductor Manufacturing International Corporation, China’s largest semiconductor maker, according to two people familiar with the situation. Commerce sent the information in a letter to companies last week, the people said, which effectively placed export controls on shipments to the Chinese company.
The U.S. needs a clearer approach to its export control regime and should coordinate more closely with allies to counter China’s technological rise, Sen. Mark Warner, D-Va., said, adding that the U.S. needs to better communicate to industry about the risks of doing business with China and its government-sponsored human rights abuses.
China has seen a steady increase in demand for imports of semiconductors since January, China’s Commerce Ministry told reporters Sept. 10, according to an unofficial translation of a press conference transcript. A ministry spokesperson said China imported 15% more semiconductors from January to August compared with the same period last year, citing the COVID-19 pandemic and greater demand for computers, tablets and “medical electronics” due to distance working and learning. China has also been “actively stocking and increasing procurement efforts” of semiconductors as the U.S. has increased export restrictions on chips to Huawei (see 2008210045). The spokesperson said China’s increased demand has been “the main driving force for the growth of the global semiconductor market.”
The Trump administration is considering placing export controls on China’s top chipmaker, the latest move in a campaign of restrictions aimed at Chinese technology companies. The controls would target the Semiconductor Manufacturing International Corporation by placing it on the Commerce Department’s Entity List, Reuters said in a Sept. 4 report. The effort is being spearheaded by the Defense Department, the report said, which petitioned Commerce’s End User Committee last week to add SMIC to the Entity List.