Heritage Report Address China’s Aspirations of Tech Dominance, Part 1 of 2: Export Controls and Tariffs

A landmark report out this week from the Heritage Foundation points the way forward on countering the most consequential strategic threat facing the U.S. in the 21st century: the Chinese Communist Party. The ultra-comprehensive report addresses the dangers emanating from the CCP across multiple domains, including national security, economic, and homeland security arenas. Helpfully, the report also offers prescriptions for fighting back against China’s hopes of dominating technological arenas. Today we release our summary – Part 1 of 2 – of some of the report’s major recommendations, beginning with export controls and tariffs to ensure U.S. leadership in semiconductors.  * * * Part 1 – The Crucial Importance of Semiconductors. “Semiconductors, also known as microchips, are omnipresent, critical to the… Read More

COMING SOON: New Report Demonstrates the Need to Defend Legacy Chips or Risk the U.S. Military Relying on a Chinese Monopoly

China Tech Threat will soon release a new briefing paper titled “Every Chips Matters,” urging the U.S. government to aggressively protect domestic legacy chip capacity, alongside high-tech semiconductors. Last month, Alan Estevez, Under Secretary for the Bureau of Industry and Security said, “Chips are a ubiquitous commodity at the legacy level.” The problem with Mr. Estevez’s thinking is that legacy chips are critical to defense systems, automobiles, medical devices, consumer electronics, and more. As evidence, Mr. Estevez’s boss – Commerce Secretary Gina Raimondo – noted that Russia was repurposing computer chips from dishwashers and refrigerators on the Ukraine battlefield for military equipment. Failing to defend this “ubiquitous commodity” invites the People’s Republic of China (PRC) to flood the international marketplace… Read More

Advanced! Advanced! Advanced! What About Legacy Chips?

If you watch what comes out of the Commerce Department on semiconductors – especially as it relates to CHIPS and export controls – you’ll notice an emphasis on advanced and leading edge chips. The U.S. aims to be the “premier destination” for leading edge chips and has “been intentional” about limiting China’s access to advanced chipmaking equipment. But what seems like an almost exclusive concentration on leading edge chips highlights two problems: First, all chips matter. Advanced and leading edge chips are no doubt important, but we can’t forget about legacy chips. These critical chips are in automobiles, planes, home appliances, medical devices, military systems, and more. A new report from CSIS underscores their strategic importance:  “Despite the name, legacy… Read More

Five Pressing Questions for BIS Director Alan Estevez

The House Foreign Affairs Committee (HFAC) announced that BIS Under Secretary Alan Estevez will participate in a hearing on Tuesday morning at 10 AM on “Combatting the Generational Challenge of CCP Aggression.” The hearing should come as no surprise. Last June, Congressman McCaul told reporters that he planned to “focus like a laser on export control issues” once he became Chairman, adding that BIS “puts too much emphasis on industry and very little if nothing on security and that has to change.” Given his national security background, which is much needed at BIS at a time like this, China Tech Threat supported a vote for Mr. Estevez in the lead up to his March 2022 confirmation. We also applauded BIS’s… Read More

U.S. Ready to Double Down on Huawei, Why Not SMIC?

The Biden administration is reportedly considering cutting Huawei, a well-known Chinese telecom giant with “inextricable ties to the Chinese Communist Party (CCP),” off from American suppliers, including the likes of Intel and Qualcomm. As a precursor, the Commerce Department is said to have told some American companies it will no longer issue licenses for U.S. tech exports to the CCP-backed company. At the end of last year, Huawei declared “business as usual” despite U.S. export controls and is believed to be backing projects in China for an “import-independent semiconductor supply chain.” Martijn Rasser, a technology expert at CNAS, described the Biden administration’s action on Huawei as a “really significant move.” He added, “The actions by the Commerce Department are partly… Read More

Biden’s SOTU Should Spur More Bipartisan Action on CCP-Backed Semiconductor Companies

On the heels of the Chinese spy balloon incident, President Biden delivered his State of the Union (SOTU) address. Three welcome calls to action related to China came through: Energize American semiconductor production, research, and innovation. Check China’s dominance in semiconductor production and other technologies. Work with international partners aimed at protecting advanced technology. The first of the key points in President Biden’s address was the bipartisan passage of the CHIPS Act, a law designed to help increase domestic production, research, and innovation in the semiconductor industry. He clearly stated, “We’re going to make sure the supply chain for America begins in America,” and later pointed out that investing to make America stronger means “Investing in American innovation, in industries… Read More

China’s Use of American Chips for Nuclear Programs Shows Necessity of Export Control Enforcement

Tight export control enforcement is as necessary as ever. That’s the takeaway from a blockbuster Wall Street Journal story on January 29, which brings China’s strategy of using American technologies to arm its military – and circumvent U.S. export controls in the process – into sharp focus. The Journal reports that “the state-run China Academy of Engineering Physics (CAEP) has managed to obtain the semiconductors made by U.S. companies such as Intel Corp. and Nvidia Corp. since 2020 despite its placement on a U.S. export blacklist in 1997.” The Journal further reports that CAEP – the top research arm of China’s nuclear weapons program – acquired the chips through resellers, which may have used or marketed them as chips for… Read More

Should Congress Revisit, Toughen Up Section 5949 of the NDAA? A Former National Security Advisor Weighs In

Last year, the United States took a major step toward the goal of addressing the dangers posed by Chinese semiconductor makers by adding YMTC to the Entity List. We hope this action is a marker of a new era of seriousness and action as it relates to countering Chinese chip-related threats. The bipartisan momentum must continue to build, and revising Section 5949 of the NDAA is a necessary step.   Section 5949 of the NDAA prohibits the U.S. government from procuring or using any parts, products, or services that include semiconductors manufactured by specific Chinese companies that represent security risks. Writing in the Washington Examiner recently, former National Security Adviser Robert O’Brien addresses the importance of stopping Chinese chips, especially those from China’s… Read More

UPDATED: Rep. Gallagher Leads New Bipartisan Panel in Congress to Counter Chinese Threats

Countering Chinese aggression will be a major issue that Republicans will pursue in 2023. In that light, it should not be surprising that now-Speaker Kevin McCarthy selected Rep. Gallagher as Chairman of the House Select Committee on China at the end of last year. Gallagher’s expertise and his ability to build bipartisan support on national security issues makes him the right man for the job. For seven years, Gallagher served as an Intelligence Officer in the U.S. Marine Corps, a tenure that included two deployments to Iraq. In Congress, he has served as a Ranking Member on the House Armed Services Committee, vocally defending America’s national security interests. Most importantly, he has pursued action against China-related threats, including problematic Chinese… Read More

New Year, New BIS Standards to Safeguard U.S. National Security

The end of 2022 brought good news for those working to keep Americans safe from Chinese tech threats: the federal government banned TikTok on federal government devices, and several state governments did the same. Most importantly, the Bureau of Industry and Security (BIS) added Yangtze Memory Technologies (YMTC) and 35 other Chinese entities to the Entity List, depriving them of American technologies that will almost find their way into the hands of the Chinese military. This major listing isn’t just a needed national security action – it sets a new standard for how BIS should approach Chinese tech companies. There is no doubt Under Secretary Alan Estevez and his team put loads of work into the process, and learned lessons… Read More