The U.S. will boost restrictions on software companies connected to China, Secretary of State Mike Pompeo said, adding that the administration is focused on increasing penalties on businesses associated with human rights abuses in the Xinjiang region. Pompeo said the companies’ use of facial recognition and artificial intelligence software -- two areas the Commerce Department is reviewing for stricter export controls (see 2007220050) -- aids the Chinese military and helps to suppress Muslim minority groups.
Exports to China
The U.S. on July 31 sanctioned a Chinese state-controlled organization and two Chinese officials for human rights violations in Xinjiang. The sanctions target the Xinjiang Production and Construction Corps, former XPCC Party Secretary Sun Jinlong and XPCC Deputy Party Secretary Peng Jiarui.
The U.S. is working on more measures to dissuade companies from doing business in China, administration officials said, including through financial incentives and more industry outreach about enforcement risks. Commerce Department official Nazak Nikakhtar and State Department official Keith Krach also said the administration is working to collaborate more with trading partners against China.
The U.S. should impose stricter export controls on advanced semiconductor manufacturing equipment to prevent China from indigenizing semiconductor technologies, technology policy experts said. If the U.S. and allies successfully block China from importing and developing specialized software and advanced chips, they should then impose end-use and end-user controls to allow shipments only for civilian uses in China, the experts said.
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China’s Ministry of Commerce criticized a U.S. decision on July 22 to add 11 Chinese entities to its Entity List (see 2007200026), calling it another case of “abused export controls,” a July 28 notice said, according to an unofficial translation. The sanctions are related to human rights abuses in China’s Xinjiang region. China said the move will cause “serious damage” to trade. “This is not good for China, not good for the United States, and not good for the whole world,” the ministry said. “China urges the U.S. to immediately stop its wrongdoing and will take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies.”
The European Union during virtual trade talks July 28 asked China for more market access for exporters and expressed concerns about its “unjustified” inspections of EU agricultural goods. China recently introduced “new restrictions” on agricultural goods due to concerns about virus contamination (see 2006300012) that have led to more customs inspections, “controls and requests for certificates on EU exports of agricultural products,” the European Commission said July 28. The EU said its beef and poultry exporters are seeing delays and are “awaiting export authorisation.”
It's not enough to just restrict sales of chips to Huawei, and convince allies not to use the Chinese company in their 5G networks, experts said at a Senate Banking Committee Economic Policy Subcommittee hearing on July 22. Rather, they testified, both 5G and export controls should be looked at more broadly. Martijn Rasser, senior fellow in the Center for a New American Security's Technology and National Security Program, said that 5G networks will be essential to all that the U.S. does in technology, so getting 5G right is urgent.
The Bureau of Industry and Security has begun a broad review of new export controls on surveillance technologies going to China, which may also include additions to the agency’s Entity List, Acting Commerce Undersecretary for Industry and Security Cordell Hull said. Hull called the review “comprehensive” and “in-depth,” saying it could lead to controls over advanced surveillance tools, artificial intelligence software and biometric technologies.
The Commerce Department will add 11 China-based entities to its Entity List for their involvement in human rights abuses in China’s Xinjiang region, a notice released July 20 said. Nine of the entities are involved in the forced labor of Muslim minority groups and two conduct “genetic analyses” to “further the repression” of the minorities, Commerce said. The additions take effect July 22.