US blackballs Chinese quantum computing firms and chip makers for trade

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The US Commerce Department has put three Chinese quantum computing firms on a trade blacklist for acting “contrary to the national security or foreign policy interests of the United States.”

The three entities include Hefei National Laboratory for Physical Sciences at Microscale, QuantumCTek, and Shanghai QuantumCTeck. They were added to the list for “acquiring and attempting to acquire US-origin items in support of military applications,” the final rule published earlier this week stated.

Hangzhou Zhongke Microelectronics, Hunan Goke Microelectronics, New H3C Semiconductor Technologies, Xi’an Aerospace Huaxun Technology, and Yunchip Microelectronics, all located in China, were also put on the list “for their support of the military modernization of the People’s Liberation Army” of China.

Officially known as the Entity List, the trade blacklist curbs exports, reexports and transfers (in-country) to these entities from US-based companies and organisations due to risk of diversion to suspect end users including the military.

This action by the US Commerce Department’s Bureau of Industry and Security (BIS) comes under the Export Administration Regulations (EAR) and becomes applicable on November 26, 2021.

On Wednesday, the BIS expanded its Entity List by 27 entries from the destinations of China, Japan, Pakistan and Singapore. The panel which decides the inclusion in the list comprises representatives from the Commerce, State, Defense, Energy and, where appropriate, the Treasury departments of the US government.

The efficacy of these sanctions may still be in question. As explained in this article, Chinese firms blacklisted earlier continued to receive licenses under both the Trump and Biden administrations.

The US is currently in a race with China on next generation technologies especially quantum computing where the Asian giant is perceived to have an edge. And in the aftermath of Covid-19 pandemic, there is across-the-board political support within the US to combat China’s technological edge.

Though the US is working on a couple of legislations aimed at regaining its edge in frontier technologies, but most efforts remain stuck in legislative quagmire.

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