Thursday, May 23, 2019

TRADE WAR ESCALATION:Trump Planning More Restrictions on Tech Exports to China

By Robert Wenzel

The Trump administration is taking steps toward issuing even more restrictions on exports of high-tech goods to China, reports Politico.

A point I have made in the EPJ Daily Alert, the trade war between the United States and China has seriously escalated. We are now well beyond a tit-for-tat tariff war.

 At first it was Google pulling Huawei’s Android license, then came an Intel and Qualcomm ban, as a result of the effective blacklisting by the White House of the Chinese conglomerate  Huawei Technologies Co Ltd, which has ties to China's leadership.

Now the blacklisting has gone truly global, thanks to US global might. Japanese conglomerate Panasonic Corp joined a growing list of global companies that are disengaging from Huawei, the world’s second-largest seller of smartphones and the largest telecom-gear maker, saying it had stopped shipments of some components.

Its move came a day after British chip designer ARM said it had halted relations with Huawei to comply with the U.S. supply blockade, potentially crippling the Chinese firm’s ability to make new chips for smartphones. Huawei uses ARM blueprints to design the processors that power its smartphones.

Then there was the arrest in Canada of Meng Wanzhou, the top Huawei executive and daughter of the founder, for extradition to the United States. She remains in Vancouver on $10 million bail and restricted movement within Vancouver.

Now Trump wants to put more restrictions on tech exports to China for no good reason.

According to Politico, the Commerce Department will soon recommend rolling back regulations that made it easier for U.S. companies to export certain goods that have both civilian and military purposes.

Commerce will also recommend ending a general policy of approving export licenses for that group of goods if they go to civilian use and instead require reviews on a case-by-case basis.

Bottom line: Trump knows one style of "negotiating": bullying.

In the particular case of trade, as I have pointed out before, his views are Neanderthal.

Robert Wenzel is Editor & Publisher of and Target Liberty. He also writes EPJ Daily Alert and is author of The Fed Flunks: My Speech at the New York Federal Reserve Bank and most recently Foundations of Private Property Society Theory: Anarchism for the Civilized Person Follow him on twitter:@wenzeleconomics and on LinkedIn. His youtube series is here: Robert Wenzel Talks Economics. More about Wenzel here.

1 comment:

  1. It's also not really clear what he is after other than credit for resolving a trade dispute he started.