What happened: The US Commerce Department on Monday unveiled plans to restrict American companies from exporting crucial software and technology to Chinese state-owned chipmaker Fujian Jinhua, saying that it poses a “significant risk” to the national security interests of the US. “China is opposed to the American generalized concept of national security, abuse of export control measures, unilateral sanctions and interference in normal international trade and cooperation,” the spokesman for China’s Ministry of Commerce has said in a press briefing today, condemning the US’ move against the chipmaker.
Why it’s important: The US is taking the ongoing trade war with China to the next level with the export restriction. The ban could significantly impact Fujian Jinhua’s operations and exacerbate US-China trade tension. The US is reportedly planning to announce new tariffs on Chinese imports as early as December. In April, the US made a similar move against Chinese telecom equipment maker ZTE by blocking it from sourcing products from US suppliers.