US adds more Chinese firms to tech ban list. Is this just the start for Trump 2.0?

The US is picking up the pace of export restrictions and more could soon be on the way, a Chinese observer said on Wednesday after the White House ordered the first Trump 2.0 tech export controls against China. US President Donald Trump could also be using the controls to extract tangible gains, aligning with his deal-making approach, another analyst said. The US announced on Tuesday that around 60 Chinese tech companies and research institutions had been added to Washington’s “entity list” to prevent Beijing from advancing artificial intelligence for the military. The list singles out Chinese entities that US firms are restricted from trading with, including companies accused of buying US-origin products to support China’s development of quantum and hypersonic weapons. It includes subsidiaries of Inspur Group, a leading Chinese IT firm that provides cloud computing and big data services to Intel, as well as the Beijing Academy of Artificial Intelligence, which develops large language models. Washington has frequently used the list to target Chinese entities that are deemed as a “threat to US national security”. US Secretary of Commerce Howard Lutnick said on Tuesday that his department was committed to “using every tool” at its disposal to “ensure our most advanced technologies stay out of the hands of those who seek to harm Americans”. The Department of Commerce did not say how these companies were linked to the Chinese government or the military, or how their activities could harm the US national security. The Chinese foreign ministry said the US was using national security as a pretext to abuse export control tools against China and warned that Beijing would take “necessary measures” to defend Chinese enterprises. Zhang Jiadong, a Fudan University professor who specialises in US export controls, said he expected more controls to come, including restricting China’s business with third-party nations. “This list could have been drawn up long ago,” Zhang said. “This shows that the Department of Commerce is picking up the work again after Trump and [Lutnick] have taken office. “China is now closing its gap with the US on tech. The Americans have a heightened sense of urgency, so these tactics will become more intense and frequent.” The administration of Trump’s predecessor, Joe Biden, rolled out a series of tech controls against China in its last months in office, including using the foreign direct product rule to restrict foreign companies from supplying products containing American technology to Beijing. Trump also used it in his first term against Huawei Technologies. Biden also used the AI diffusion rule, which requires AI processors to be stocked in the US and its allies and prevents China from getting them from third countries. Zhang said Trump would be interested in keeping or even strengthening this rule. Trump has made maintaining the American edge in AI a centrepiece of his policy, pledging to invest US$500 billion to build AI infrastructure in the US. He has described the advances of Chinses start-up DeepSeek as a “wake-up call” for the US industry. If you reward a bully, he comes back for the rest of your lunch money every day Einar Tangen, Taihe Institute Einar Tangen, a senior fellow with the Beijing-based Taihe Institute, said the expansion of the US export control list was a glimpse of Trump’s transactional approach towards China – wielding some new restrictions to push China for “some sort of deal”. Tangen said Trump’s foreign policy goal was to “split China and Russia” and he could try to “contain” China if he failed to achieve this initial goal. “He has told them that we’re doing this to create a pressure point … to break them from Russia. If you can’t break them from Russia, we’ve got to figure out how we can contain them somehow … Let’s figure out what we can grab.” US Secretary of State Marco Rubio has hinted at US intentions to drive a wedge between China and Russia, but ties between Beijing and Moscow appear to have remained steadfast, with the Kremlin keeping Beijing in the loop about its exchanges with Washington. Tangen said China had ways to respond to Trump’s tech restrictions and was unlikely to be “pushed around” by Trump. “They can do a measured response, and that’s what they’ll do,” he said, adding that China understood that it could not “reward a bully”. “If you reward a bully, he comes back for the rest of your lunch money every day,” he said. Chong Ja Ian, a US-China relations specialist at the National University of Singapore, said China may put in place export restrictions over key resources, as well as tariff and non-tariff barriers on US goods. China has already retaliated for previous US tech restrictions with export controls on critical minerals such as gallium and graphite, which are essential for chipmaking. Earlier this month, it also prevented exports of dual-use items for 15 US AI companies and drone makers. Chong added that the new restrictions could also affect prospects for a Trump-Xi summit “if neither side wishes to look weak”. Trump said last week that President Xi Jinping would visit the US in the “not too distant future” following reports that a meeting between the two leaders was being arranged. China has not confirmed whether such a meeting will take place. “The current state of distrust between Washington and Beijing may be an impediment to a leaders’ meeting despite the fact that doing so may be of interests to both sides,” Chong said.

US adds more Chinese firms to tech ban list. Is this just the start for Trump 2.0?

America has a sense of urgency about the way China is closing the technology gap, analyst says

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