Of all the outstanding trade policy options -- new trade promotion authority, requiring Section 301 exclusions, revisions to antidumping law and a customs modernization law -- the head of government relations at Flexport said he thinks customs modernization is the most likely to pass. "I think we are coming on the cusp of something," Darien Flowers said, and said he thinks a bill will be enacted before 2025. Flowers once worked for Sen. Bill Cassidy, the Louisiana Republican who is leading the bill, though more recently he served on the minority staff of the Senate Commerce Committee.
U.S. and foreign companies “seem to be equally confused” by the Bureau of Industry and Security's new China chip export restrictions (see 2210070049), said Alison Stafford-Powell, a trade compliance lawyer with Baker McKenzie, speaking Nov. 15 during a virtual event hosted by the law firm. She called the new BIS rule “incredibly complex" and said industry needs more guidance from the agency.
China’s Semiconductor Manufacturing International Corporation is expecting its fourth quarter revenue this year to drop by 13% to 15% due in part to new U.S. export controls, the company said in an earnings release last week. SMIC said the drop in revenue is because “customers need time to interpret the newly released US export control rules” and “due to the weak demand in the mobile phone and consumer market.” The new controls, announced by the Commerce Department last month (see 2210070049), will “have an adverse impact on our production and operation,” SMIC said. “We have maintained close communications with suppliers, while the clarification of some definitions in the new rules and the assessment of impact on the Company are still in progress.”
President Joe Biden and Chinese President Xi Jinping will meet in-person in Indonesia Nov. 14 to “discuss a range of regional and global issues,” the White House announced last week. The meeting will take place about a month after the U.S. announced new export licensing requirements designed to restrict China’s ability to acquire advanced computing chips and manufacture advanced semiconductors (see 2210070049).
The U.S. and South Korea launched a new working group this week to better harmonize the countries’ export control decisions and ensure a “level-playing field” for businesses. BIS said it hopes the working group will help both sides identify “specific actions” to “advance export controls cooperation.” The announcement comes about a month after the U.S. issued a range of new semiconductor-related restrictions on exports to China -- controls that the U.S. hopes to convince allies, including South Korea, to also impose (see 2210270047 and 2210070049).
The new U.S. chip controls against China (see 2210070049 and 2211010042) mark a “major escalation” in the U.S.-China technology war and will likely have a significant effect on China’s technology capabilities, Bank of America said this week. The bank also warned that the controls, which are “more comprehensive and stricter than what we have seen in the past,” could ultimately open the “door to more sweeping restrictions in other domains like leading edge manufacturing.”
In a reversal, Germany now plans to block the purchase of Dortmund-based semiconductor company Elmos by Sweden’s Silex, a subsidiary of China's Sai Microelectronics, Elmos said this week. Elmos said Germany’s Federal Ministry of Economics and Climate Protection had previously told both parties that the transaction was “likely to be approved,” according to an unofficial translation of a Nov. 7 statement. Elmos said the deal will “probably be prohibited in the upcoming cabinet meeting on November 9, 2022.”
Georgetown University's Center for Security and Emerging Technology released a report this week examining China’s artificial intelligence workforce and shedding light on the country's efforts to invest in the AI industry. The report found that more than 30% of the Chinese job postings analyzed by the researchers could be considered AI or AI-related. The report argues that U.S. AI education and workforce policies need to “grow, cultivate, attract, and retain the world’s best and brightest,” and understanding China's AI workforce "could provide U.S. policymakers with important insight.” The findings come about a month after the U.S. announced new restrictions on advanced computing and semiconductor equipment tools, which could be used by China in AI applications (see 2210070049).
U.S. semiconductor company Nvidia is offering a new advanced chip to Chinese customers that complies with the Commerce Department’s new export restrictions (see 2210070049), a company spokesperson said Nov. 8. The person said Nvidia's new A800 chip, which recently went into production, is designed to meet U.S. licensing requirements. "The NVIDIA A800 GPU, which went into production in Q3, is another alternative product to the NVIDIA A100 GPU for customers in China," the spokesperson said in a Nov. 8 email. "The A800 meets the U.S. Government’s clear test for reduced export control and cannot be programmed to exceed it." The spokesperson declined to say if Nvidia had confirmed with Commerce whether the chip complies with U.S. export regulations. Reuters first reported the new chip.
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