The US government is planning to tighten export controls on semiconductors and other high-tech goods sent to China, marking an increase in restrictions implemented under the previous administration.
According to reporting from Bloomberg, US president Donald Trump will seek to implement stronger limits on the export of advanced technology to China by US firms, notably Nvidia. A spokesperson for the company declined to respond to a request for comment from Reuters.
It follows the signing of a memo by Trump to task the Committee on Foreign Investment in the US (Cfius) with restricting “Chinese investments in strategic US sectors like technology, critical infrastructure, healthcare, agriculture, energy, raw materials, and others”.
Allied nations
The Bloomberg report also notes that the Trump administration is putting additional pressure on tech companies in allied nations.
These include Japan’s Tokyo Electron as well as the Netherlands’ ASML, to stop “maintaining semiconductor gear” in China, according to anonymous sources.
Following on from measures imposed by former US president Joe Biden, the White House is trying to ensure allies match restrictions on American chip-gear companies, among them Lam Research, KLA and Applied Materials.
Apple investment
One major investment that appears to have been influenced by Trump’s measures on trade is a fresh US$500bn injection into the US by tech giant Apple.
The firm announced yesterday (25 February) that it is making its “largest ever spend commitment” over the next four years into the US, which it says “builds on Apple’s long history of investing in American innovation and advanced high-skilled manufacturing”.
CEO Tim Cook said that the company was “thrilled to expand our support for American manufacturing”, adding that “we’ll keep working with people and companies across this country to help write an extraordinary new chapter in the history of American innovation”.
The president has trumpeted the announcement as proof of his tariff programme’s effect on bringing manufacturing back to US shores, saying that “they’re going to build here instead because they don’t want to pay the tariffs” following a meeting with Cook.
The investment will pay for a new advanced manufacturing facility in Texas as well as 20,000 new jobs, according to the New York Times. This will support the assembly of servers “previously manufactured outside the US”.
Taiwanese electronics manufacturer Foxconn will also be involved in the new Texas facility, after it has invested in US and Mexican manufacturing in a bid to avoid the effect of US tariffs on Chinese-made goods.
Service game
Trump is also considering his next moves against countries that charge digital services taxes on American firms, according to the FT.
The memo signed by the president last week on limiting Chinese investments in “strategic US sectors” has also tasked the US Trade Representative to investigate digital services taxes levied by the UK, EU nations, Canada and others.
Trump wrote as part of the memo that he will “not allow American companies and workers and American economic and national security interests to be compromised by one-sided, anti-competitive policies and practices of foreign governments”.
The investigations will also look more broadly at regulation in foreign markets that “inhibit the growth” or “jeopardise [the] intellectual property” of US corporations.
