President Joe Biden is reportedly planning to sign an executive order limiting United States investments in key technologies in China, a further escalation in the antagonism between the two countries over semiconductor chips and other advanced tech.
The order will focus on semiconductors, quantum computing, and artificial intelligence, according to Bloomberg. The order won’t affect existing investments but would prohibit certain new ones. The White House is reportedly considering releasing the order in mid-August, although internal discussions could delay the order. If the restrictions are implemented, they will not go into effect until 2024.
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The United States and China have been going back and forth for nearly a year in a war over semiconductors and the components required to make advanced military technology.
The United States has been attempting to cut back on its chip exports to China as well as improve U.S. abilities to construct chips locally. The Commerce Department implemented rules in October 2022 that placed dozens of Chinese companies on an “unverified” list, limiting their ability to purchase or acquire semiconductors or advanced technology without a license.
Congress passed the CHIPS Act in 2022, providing more than $52 billion to subsidize domestic production. Commerce Secretary Gina Raimondo announced in February that the United States would construct at least two new semiconductor factory hubs with the money provided by the CHIPS Act. Biden also announced in March that there were new limits on whether Chinese companies could receive the CHIPS funding.
Treasury Secretary Janet Yellen visited China in early July, where she spoke with Chinese officials about how U.S. companies were being treated there.
China implemented restrictions on gallium and germanium, two metals necessary for creating high-level chips, in early July over alleged national security concerns. The country banned the use of chips from the U.S. chip maker Micron in May.
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The Chinese government has also cut back on government funding for improving chip manufacturing, which could slow the country’s ability to keep up with the U.S. in chip development.
