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China Retaliates Against US, Trump Aide's Response Unexpected

| Source: CNBC Translated from Indonesian | Trade
China Retaliates Against US, Trump Aide's Response Unexpected
Image: CNBC

China has begun to retaliate against a series of technology restrictions imposed by the United States. However, Washington is not easing up in the slightest. It is instead expected to continue increasing pressure on China’s technology supply chain. In recent months, the Federal Communications Commission (FCC), an agency better known for handling spectrum auctions and television station licensing, has emerged as the spearhead of President Donald Trump’s most aggressive policies against China. Under the leadership of Brendan Carr, a Trump ally, the FCC has taken various steps to pressure what the US views as risks to the supply chain and national security. Citing a Reuters report, the FCC has banned the import of new models of Chinese-made drones, routers, inverters, and robots. The agency has also begun the process of blocking all Chinese laboratories from testing electronic devices such as smartphones, cameras, and computers destined for the US market. The FCC is even currently drafting rules that could ban the import of new models of Chinese-made data centre components. This move is aimed at protecting the technology infrastructure underpinning the artificial intelligence (AI) industry boom in America. According to US officials, the policy has White House support. Interestingly, the FCC is said to be trying to avoid direct confrontation with Beijing by drafting rules targeting specific technologies without explicitly mentioning China. However, this strategy has now triggered a response from Beijing. Previously, on Wednesday, China announced tighter export controls on drones and related technology destined for the United States. Beijing also imposed sanctions on US-based testing and certification companies in response to the FCC’s actions and other Washington trade policies. Sources familiar with the matter said Chinese officials had attempted to establish communication with the FCC, but the effort was rebuffed. The FCC declined to comment on the approach from China, while the Chinese Embassy in Washington did not respond to Reuters’ request for comment. This escalation comes ahead of Trump’s planned meeting with Chinese President Xi Jinping next September. The two are expected to discuss efforts to stabilise bilateral relations, which were shaken by last year’s tariff war. Although there is usually pressure to de-escalate tensions ahead of high-level meetings, national security experts believe US pressure on China will continue. ‘Just because China is responding doesn’t mean all of this will suddenly stop,’ said Chris McGuire, a former White House official under President Joe Biden. He assessed that the US administration is becoming frustrated because Washington believes China is not complying with previous agreements. China’s Ministry of Commerce did not provide a comment to Reuters regarding the FCC. Previously, Beijing opposed the FCC’s moves, calling the policies discriminatory against Chinese companies and potentially disruptive to global supply chains, and vowed to take retaliatory action. The FCC and the White House also declined to comment. However, a US official said the FCC’s actions are not aimed at any specific country. ‘The FCC’s recent actions are global in nature and do not target any specific country. These measures are designed to promote America’s reindustrialisation and ensure our national security,’ the official said. The FCC’s approach differs from Trump’s broader policy towards China. After last year’s tariff war ended in a fragile truce, Trump took several steps to ease tensions, including relaxing restrictions on advanced AI chip exports to China and delaying approval for a US$14 billion arms sale to Taiwan. US officials and analysts believe the FCC is Washington’s way of maintaining pressure on China without damaging overall bilateral relations. ‘I don’t think it’s an exaggeration to say the FCC has become the centre of gravity for competitive actions against China in this Trump administration,’ said Eric Sayers of the American Enterprise Institute.

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