In the global technology landscape, tensions are rising as the U.S. asserts its disapproval over China’s de facto prohibition on the acquisition of memory chips produced by Micron Technology.
The clear message from the United States government is its unequivocal refusal to tolerate what it sees as “economic coercion” aimed at an American corporation.
The situation: Micron’s plight and China’s unwelcomed stance
On May 21, China’s cyberspace regulator declared that Micron, a leader in the U.S. memory chip manufacturing sector, had not passed its network security review.
Consequently, the regulator declared its intention to prevent operators of crucial infrastructure from purchasing from the company. This move, which threatens to curtail Micron’s revenue, provoked a strong response from the government.
Commerce Secretary Gina Raimondo expressed the U.S.’s unwavering opposition to China’s actions. According to her, the sanctions against Micron are a case of “plain and simple economic coercion,” targeted at a single U.S. company without any substantial reasoning.
Raimondo’s comments came in the wake of a G7 initiative, aimed at pushing back against economic coercion by China. This unanimous decision, she noted, reflects the global community’s alignment with the the country’s stance against non-market practices that disrupt the global economic balance.
The U.S.’s response: Staunch opposition and a call for allied support
In response to China’s tactics, the U.S. is rallying its allies to counteract this form of “economic coercion.”
Raimondo highlighted the U.S.’s commitment to work closely with its partners to address the challenges posed by China’s non-market practices, a sentiment she also conveyed to China’s Commerce Minister, Wang Wentao, during their recent meeting.
Furthering the U.S.’s efforts to fortify its domestic semiconductor production, Raimondo pointed to the $52 billion CHIPS Act. This investment, she said, is aimed at bolstering the country’s domestic semiconductor production capabilities, an essential pillar of its technological sovereignty.
Notwithstanding, she expressed a welcoming attitude towards international cooperation, suggesting that companies from Indo-Pacific Economic Framework (IPEF) countries, such as Japan, Korea, and Singapore, are expected to participate in the CHIPS Act funding.
The unfolding saga surrounding Micron’s plight underscores the intricate dynamics of international technology trade, a space increasingly characterized by geopolitical maneuvers.
The U.S.’s emphatic rebuff to China’s actions and its call for a collective stance against such practices signify a turning point in the global discourse on fair trade practices in the tech industry.