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Donald Trump's government is planning to further tighten export restrictions on semiconductors to China.
In doing so, it would not only continue the measures of the Biden administration, but expand them considerably, reports Bloomberg. The aim is to slow down China's technological progress and involve key allies in the US strategy.
US officials recently met with representatives from Japan and the Netherlands to discuss new restrictions on companies such as Tokyo Electron and ASML. Specifically, the aim is to prevent engineers from these companies from maintaining semiconductor production facilities in China. This could significantly affect the production capacities of Chinese chip manufacturers.
Chinese semiconductor shares are already pulling their heads in. The FactSet China Semiconductor Index loses a whole percentage point, which does not seem too tragic given that the index is up around 50 percent for the year:
In addition, the Trump camp is aiming to further reduce the amount and type of Nvidia chips that can be shipped to China without an export license.
The Trump administration's strategy aims to have close US allies introduce export restrictions similar to those already in place for US chipmakers such as Lam Research, KLA and Applied Materials. Such a move could put further pressure on China's semiconductor industry and increase its dependence on domestic alternatives.
