US blacklists seven Chinese supercomputing firms

The entities are involved with building supercomputers used by China’s military actors

US Secretary of Commerce Gina Raimondo said the White House will try its best to prevent China from leveraging American technologies to support destabilising military modernisation efforts. EPA

The US added seven Chinese supercomputing firms to a list of entities banned from receiving exports from American companies, citing activities contrary to the national-security or foreign-policy interests of the US.

The companies were added to the so-called entity list, which prohibits American firms from doing business with them without first obtaining a US government licence, the Commerce Department said in a statement.

The new entities are involved either with building supercomputers used by China’s military actors, its military modernisation efforts or weapons of mass destruction.

The entities are Phytium Information Technology, High-Performance Integrated Circuit Design Centre, Sunway Microelectronics and National Supercomputing Centres in Jinan, Shenzhen, Wuxi and Zhengzhou, the US said.

Shares in Phytium suppliers including China Great Wall Technology Group and Taiwan’s Alchip Technologies fell as much as 10 per cent on Friday.

“Supercomputing capabilities are vital for the development of many, perhaps almost all, modern weapons and national-security systems, such as nuclear weapons and hypersonic weapons,” the US Commerce Secretary Gina Raimondo said in the statement.

“The Department of Commerce will use the full extent of its authorities to prevent China from leveraging US technologies to support these destabilising military modernisation efforts.”

China firmly rejects US attempts to maintain its monopoly over the high-tech industry and contain the nation by over stretching the concept of national security, its Foreign Ministry spokesman Zhao Lijian said in a regular press briefing in Beijing on Friday.

“US oppression will never stop our progress in high technology,” Mr Lijian said. “It will only make us more determined and resolved in speeding up our innovation.”

However, the latest action doesn’t fully cut off the Chinese firms from US technology.

That differs from the action taken against Huawei Technologies, where the government applied the so-called foreign direct-product rule to restrict Huawei’s ability to use Taiwan Semiconductor Manufacturing Company and others to fabricate their chips.