How Trump's export curbs on semiconductors and equipment hurt the US technology sector
September 28, 2020
Chad P. Bown
President Donald Trump’s much-touted “phase one” trade agreement with China is falling well short of its goal. Under the deal, Trump pledged that China would purchase an additional $200 billion of US exports over 2020 and 2021. With two-thirds of 2020 now in the books, China has imported less than one-third of the goods that Trump assured Americans it would buy this year. One rare exception are high-tech products like American semiconductors and chipmaking equipment, which have managed to maintain robust export sales despite the pandemic and anti-China rhetoric of a US election campaign.
That bright spot has suddenly dimmed, however, and not because of China. The Trump administration is remaking the US export control regime in a way that could lead to sharp cuts in foreign sales of both of these American industries. Elements of the new regime may be well-motivated, seeking to mitigate legitimate national security risks. Other links to national security are, at best, more tenuous and will certainly come at considerable economic cost to American companies.
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