Technology

The US adds Chinese supercomputers to export the blacklist

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Enlarge /. An employee works next to China’s ‘Sunway TaihuLight’ supercomputer at the National Supercomputer Center in Wuxi, Jiangsu Province, China on August 29, 2020.

China News Service | Getty Images

The US has accused Chinese groups of building supercomputers to help the Chinese military on an export blacklist. This is the first such move by the Biden administration in making it difficult for China to get US technology.

Three companies and four branches of the Chinese National Supercomputing Center were added to the US government’s Entity List, which prevents American companies from exporting technology to the groups without a license.

The US Commerce Department said the groups were involved in building supercomputers used by Chinese “military actors” and had facilitated programs to develop weapons of mass destruction.

“Supercomputing capabilities are critical to the development of many – perhaps almost all – modern weapons and national security systems such as nuclear weapons and hypersonic weapons,” said Gina Raimondo, US Secretary of Commerce.

She said the government will “use the full scope of its agencies to prevent China from using US technology to aid these destabilizing military modernization efforts.”

The Chinese companies are Tianjin Phytium Information Technology, the Shanghai High-Performance Integrated Circuit Design Center, Sunway Microelectronics and the branches of the National Supercomputing Center.

The US is concerned about China gaining access to American technology that will help the People’s Liberation Army bridge the gap with the US military and field weapons that could change the balance of power in the Indo-Pacific.

The Washington Post said this week that Phytium has developed semiconductors that US technology uses to power supercomputers used to develop hypersonic missiles that are difficult to detect because of their speed.

According to the newspaper, Phytium used technology from Cadence Design Systems and Synopsys. The shift in the list of companies would effectively prevent the two California-based companies from offering services and products to the Chinese companies. But it wouldn’t stop them from supplying the Chinese groups if this technology were manufactured in facilities outside of the US.

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The Washington Post said Phytium has outsourced the manufacture of its chips to TSMC, the Taiwanese company that has become the world’s most advanced semiconductor maker.

The Financial Times previously reported that the Trump administration had urged the Taiwanese government to stop TSMC from producing chips for Huawei that are allegedly used in Chinese missiles.

The inclusion of Chinese corporations in the entity list does not prevent TSMC from supplying them with chips, since the US did not apply the “foreign direct product rule” which would prohibit foreign companies using US technology such as TSMC from exporting to it Phytium or the other groups.

The Trump administration used this rule to implement strict export controls related to Huawei to fill previous loopholes.

Michael McCaul, the top Republican on the House Foreign Affairs Committee, welcomed the move to add Phytium to the list of companies but said it was only “half a measure” as the foreign direct product rule was not enforced.

“The lessons we have learned from the gaps in the Huawei company list need to be incorporated into standard operating procedures for our export control policy to ensure that they are truly effective,” said McCaul.

However, Lindsay Gorman, a technology expert at the German Marshall Fund, said that by using a tool widely used by his predecessor, Biden “put to bed” the feeling that he was not going to be tough on China.

“It was an open instrument as to whether a preferred instrument of the Trump administration would continue in the Biden administration,” Gorman said.

Trump put dozens of Chinese companies on the list of companies, including Huawei, the telecommunications equipment maker, and Semiconductor Manufacturing International Corporation.

The Biden administration is currently considering dozens of measures related to China that Donald Trump took in his senior year in office, including an order prohibiting Americans from investing in Chinese companies that the Pentagon says will aid the People’s Liberation Army . The US is also talking to allies in Asia and Europe to find ways to coordinate export controls.

© 2021 The Financial Times Ltd. All rights reserved. No redistribution, reproduction or modification in any way.

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Steven Gregory