China Chip Ban: Key Events Leading in Tech Industry

Washington and Beijing have maintained a complex, often rocky relationship since the late 1940s. In recent years, tensions between the world’s two leading powers have hit a fever pitch resulting in a tit-for-tat tech war that has global implications.

This article serves as a timeline of key events that led up to the October 2022 China chip ban that many see as the United States’ most provocative action to date

May 2015 - Made in China 2025

In May 2015, China’s State Council announced a massive economic restructuring initiative called “Made in China 2025.”

The audacious plan, with key goals set for 2025, 2035, and 2049, would see China rapidly expand its capacity to manufacture advanced technology in hopes of dominating areas like new energy vehicles, robotics, and artificial intelligence.

Noble ambitions without a doubt, however, some on the US side have argued that the initiative heavily relies on “

forced technology transfers, intellectual property theft, and cyber espionage” for China to achieve its loft objectives.

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April 2018 - The First Domino to Fall: ZTE

In April 2018, with the stroke of a pen, ZTE was blocked from accessing much of the US-made technology that is critical in manufacturing their phones and telecom equipment.

Policymakers imposed the ban against ZTE for its role in exporting US technology to sanctioned countries including Iran and North Korea.

The ban forced the company to its knees resulting in billions of dollars in lost revenue. It was reversed several months later after ZTE agreed to comply with sanctions and paid a hefty $1 billion fine.

October 2018 - Fujian Jinhua Integrated Circuit Co

The ZTE saga was just a taste of what was to follow.

By October, the US had a completely different Chinese tech firm in the crosshairs. This time it was Fujian Jinhua Integrated Circuit Co., a state-owned chipmaker that the

US labeled as an existential threat to its national security interests.

The US Commerce Department imposed severe restrictions that blocked American organizations from selling the company critical technology that it relied on to manufacture components.

December 2018 - The Arrest of Huawei’s CFO

US-China tensions escalated again in December 2018 following the arrest of Meng Wanzhou, Huawei’s CFO and the daughter of the company’s founder.

While she was detained and held in Canada, the arrest was made at the request of the US authorities who accused Meng of bank and wire fraud.

January 2019 - Huawei Indicted for Stealing Trade Secrets

Meng’s arrest made clear that Washington was out for Huawei, but that was just the opening salvo.

The following month, the Justice Department brought forth a 10-count indictment against Huawei alleging that the company proposed bonuses for employees who stole trade secrets and other confidential information from T-Mobile.

Shortly after the indictments, the US began a vigorous public campaign to persuade its European allies against using Huawei 5G equipment in their networks.

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May 2019 - Huawei Is Blacklisted

By May, things escalated even further after the US Commerce Department placed Huawei on its restricted companies list meaning they could no longer access key American-made technology without first getting approval from the government.

After this, firms like Google decided to self-isolate from the company, impacting Huawei’s ability to ship devices that used Google’s Android OS .

October 2019 - US Targets China's AI Sector

In October 2019, the US targeted several of China’s most prominent AI firms including SenseTime, Megvii, Yitu, Hikvision, and iFlytek, among others.

These firms were added to the Commerce Department’s trade blacklist with US officials citing human rights violations against the Uyghurs and other minority groups as the primary reason they were targeted.

July 2020 - Washington Goes After TikTok

In July 2020, Former president Donald Trump himself threatened ByteDance, TikTok’s parent company, with an all-out ban if they didn’t sell the app to an American company. Microsoft, Oracle, and Walmart put forth efforts to buy the app, but no deal was ever reached.

December 2020 - SMIC and DJI Added to the Entity List

At the close of 2020, dozens more Chinese companies were added to the US Commerce Department’s entity list with the biggest names being SMIC and DJI.

Authorities said these companies were blacklisted in an effort to “not allow advanced US technology to help build the military of an increasingly belligerent adversary.”

December 2021 - US Alleged Chineses Biotech Firms Possess Brain Control Technology

In December 2021, the Treasury’s Office of Foreign Assets Control imposed technology export constraints on 30 different Chinese companies primarily operating in the biotechnology sector.

Like the plot from a dystopian sci-fi novel, the US accused some of the listed companies of supporting the Chinese military in developing “brain-control weaponry.”

Despite such exotic allegations, the US has refused to elaborate further on the brain control technology it believes China possesses.

August 2022 - CHIPS and Science Acts Becomes Law

The signing of the CHIPS and Science Act signaled that the US intents to maintain its position as the leading innovator and exporter of critical semiconductor technologies

While the bill does little in directly targeting China, it’s clear that the US government has no plans to allow a rival power to take command of such a globally important industry.

October 2022 - US Imposes The Harshest, Most Impactful Restrictions to Date

In October 2022, the US imposed its harshest and potentially most impactful restrictions against Chinese companies to date.

These latest measures completely block the sale of many bleeding edge chips in addition to the equipment and human capital required to make them. This could significantly handicap China’s effort to continue advancing in areas like artificial intelligence and supercomputers.

One analyst says this move by the US will send China “back to the Stone Age” if it’s fully enforced. The biggest hurdle that China faces in moving past the new restrictions is the inability to access American know-how. Many of the Chinese chip firms added to the list employ American scientists and engineers to operate the complex machinery required to manufacture the latest chips. Under the new restrictions, this is no longer an option.