By imposing restrictions on the American semiconductor giant Micron, China is raising its voice against the United States, a technological standoff against a backdrop of diplomatic tensions.
Several analysts interviewed by AFP believe, however, that Beijing’s room for maneuver is undoubtedly limited, while its priority is to revive the second largest economy in the world, weakened by three years of anti-COVID policy.
A highly strategic sector, microchips fuel the modern global economy, nesting in LED bulbs, washing machines, cars or cell phones.
But those made by Micron “present potential problems for network security”, threatening “China’s national security”, the body responsible for cybersecurity in China announced on Sunday, which called on “infrastructure operators working with sensitive data in China” to stop buying them.
In response, Washington expressed its “very serious concerns”.
The day before, the leaders of the G7 countries, meeting in Hiroshima, had rightly warned against any attempt at “economic coercion”, aimed, without naming it, at the practices of China.
“The strong statement from the G7 may have added fuel to the fire,” notes Gary Ng, economist specializing in the sector at Natixis.
And the case of Micron, which marks an escalation in the battle between Beijing and Washington, “will set a precedent”.
“Reprisals”
The procedure against the group, launched at the end of March, was the first against a foreign company since Beijing’s tightening in 2021 of cybersecurity rules.
“I would not be surprised if regulators decide in the future to use these procedures as a tool of geopolitical reprisals,” said Gary Ng.
The notion of “infrastructure operators working with sensitive data” is very broad, observes Emily Weinstein, a researcher at Georgetown University: from online public services to defense and health, including the conservation of the ‘water.
She recalls that “China has always found national security or other reasons to create protectionist barriers”.
Beijing thus sometimes requires technology transfer agreements, obliges companies to store all data locally, and in certain sectors foreign companies must create a joint venture with a local partner.
The move against Micron “is clearly in retaliation for what Beijing perceives as Washington’s support for Micron and the US semiconductor industry,” said Paul Triolo, China technology expert at consulting firm Albright Stonebridge.
Because in October 2022, the United States, also citing “national security”, announced new export controls to limit the purchase and manufacture by Beijing of high-end chips “used in military applications”. .
In particular, they had banned Chinese chipmakers, such as Micron’s rival, Yangtze Memory Technologies.
Beijing’s response is above all political, according to the expert, pointing out that other procedures launched against Chinese companies – including Didi, the Chinese Uber – had focused on the data collected, without mentioning national security.
The South Korean option
But Micron, the world’s fourth-largest semiconductor maker, was an easy target for China because its chips can be replaced by those from South Korea’s Hynix and Samsung.
Targeting other American giants, such as Intel or Qualcomm, will be more complicated because their chips are used in consumer goods, in particular mobile phones, manufactured in China and then exported.
And Beijing cannot risk weakening its economy, which is still recovering from zero COVID.
“By targeting American companies like Micron, the objective is to send the signal that Beijing is ready to make some sacrifices in its battle with the United States”, judge Ja Ian Chong, associate professor of political science at the university. national of Singapore.
“But Beijing is careful to limit” these sacrifices, he adds, quoted by the Bloomberg agency.
“China has been very cautious and hasn’t taken too many retaliatory measures […] because Beijing cannot quickly increase its national capacities to face a possible deficit” of chips, observes Gary Ng.
Now it “is betting on switching to South Korean suppliers” to compensate, according to Paul Triolo.
But the White House last month called on South Korean manufacturers not to export to China. And she also put pressure on the Netherlands and Japan, which announced restrictions in this area.