US Expands Comprehensive China Containment... South Korea Fears Spillover Effects

China Proudly Unveils Cutting-Edge Products
US Expands Regulatory Measures in Response

If Exclusion of Chinese Technology Increases
Korea's Damage Is Inevitable

Encouraging Ally Participation as Well

U.S. containment of China’s ‘tech rise’ is spreading across all fronts. There are even concerns that South Korea could suffer unexpected damage as regulations extend to advanced products containing Chinese technology.

“Biden Considering Response to Chinese Product Tsunami”

The photo is not related to any specific expressions in the article. [Image source=Getty Images Bank]

According to the New York Times (NYT) on the 8th (local time), the Biden administration is reviewing measures such as tariff increases in response to a tsunami of Chinese products. The NYT reported, “President Biden’s aides are concerned about signs of a low-priced export offensive from China’s overproduction already appearing in Europe.”

China is driving growth by producing far more competitive products such as automobiles, solar panels, lithium batteries, and steel than its domestic demand and exporting them to the global market. This is because the Chinese government is pouring massive subsidies, including loans from state-owned banks.

The U.S. views the tsunami of Chinese products as a threat to domestic companies it aims to foster through the Inflation Reduction Act (IRA). The NYT reported, “Biden administration officials are closely monitoring production and pricing information of Chinese products and are trying to block or reduce imports of products receiving subsidies from the Chinese government.” They are considering tariff increases in some strategically important industries.

The U.S. has begun a tight pressure campaign to check China, which continues to release advanced products despite regulations targeting China. Recently, the U.S. Department of Commerce revoked export licenses for companies such as Qualcomm and Intel that export semiconductors for laptops and communication devices to China’s Huawei. This followed political controversy last month when it was revealed that Huawei would equip its first AI laptop, the ‘MateBook X Pro,’ with Intel’s new Core Ultra 9 processor. The U.S. Department of Commerce is also considering erecting barriers to prevent China from accessing advanced AI software like ChatGPT.

U.S. Commerce Department: “May Regulate Chinese Connected Cars”

Lummondo, U.S. Secretary of Commerce.
Photo by Yonhap News

U.S. Secretary of Commerce Gina Raimondo stated in a foreign media interview released that day, “We may go as far as banning Chinese connected vehicles.” At a House Ways and Means Subcommittee hearing, Secretary Raimondo expressed concern that “Chinese connected cars can collect massive amounts of data on who Americans are, what conversations they have, where they go, and their driving patterns.” President Joe Biden in February instructed the Commerce Department to investigate Chinese connected vehicles, which are considered a security threat due to risks such as hacking and data leaks when using technology from the ‘adversary’ China.

There is a prospect that Chinese technology used in connected vehicles sold in the U.S. could also be regulated. This would inevitably impact the South Korean automotive industry, as it is difficult to completely exclude China from the global automotive supply chain. In a statement submitted to the U.S. Department of Commerce on the 30th of last month, the South Korean government expressed concerns that “the broad scope of the connected vehicle supply chain investigation, the uncertainty surrounding the range of potential regulatory targets, and the timing of enforcement could all place a significant burden on the industry.”

The U.S. Treasury Department is expected to finalize investment regulations on China within the year. The regulations will include provisions prohibiting U.S. capital from investing in Chinese advanced technology companies.

U.S. Encourages Allied Participation

The Biden administration has also emphasized cooperation with the European Union (EU) and allied countries to contain China. Developing countries have also been encouraged to participate. Brian Deese, former chair of the National Economic Council (NEC) under the Biden administration, stated, “Developing countries such as Brazil and India, which have recently begun resisting China’s trade practices, should also be included in the response.”

This content was produced with the assistance of AI translation services.