The Commerce Department created the companies the blacklist for “the construction of supercomputers used by the Chinese military for the modernization of the armed forces and the WMD development program”.
The United States has long accused Chinese companies of being loyal to the People’s Republic and passing on sensitive information. The Chinese Communist Party said earlier that it does not engage in industrial espionage.
“High-performance computing is vital to the development of many – perhaps almost all – modern weapons and national security systems, such as nuclear weapons and hypersonic weapons,” said US Secretary of Commerce Gina Raimondo. “The Department will do all it can to prevent China from using US technology to support these destabilizing military modernization efforts.”
The new rules limit US exports to the companies in question. The measures will take effect immediately, but will not apply to goods from US suppliers already in transit to China. The restrictions do not completely exclude the seven US tech companies. The seven companies are: Tianjin Phytium Information Technology, Shanghai High-Performance Integrated Circuit Design Center, Sunway Microelectronics and the National Supercomputing Center in Jinan, Shenzhen, Wuxi and Zhengzhou.
Huawei and Xiaomi
Under former President Donald Trump, the United States added many Chinese companies to its economic blacklist. Among these companies is Huawei, which is charged with even stricter penalties.
Xiaomi, the third largest smartphone maker in the world, was also introduced by the United States in January blacklisted companies believed to be associated with the Chinese military. US judge issued trade restrictions against Xiaomi in March temporarily abandoned again.