Trump’s election win could take the U.S.-China chip war to a new level

Since President-elect Donald Trump’s first term in office, the U.S. has wielded its trade restriction and sanctioning powers in an effort to curb China’s technological advances. Now that he’s headed back to the White Home, the semiconductor war between the U.S. and China could escalate.

“If Trump ascends to the office, he’s already said in his campaign rhetoric that he’s going to double down and even make tariffs as smartly as export controls extra excessive,” Arthur Dong, a professor at Georgetown College’s McDonough College of Industry, told Quartz in a pre-election interview.

Efforts to late China’s advanced chipmaking abilities below Trump’s first presidential term were persisted by the Biden administration.

Earlier this year, the Biden administration was reportedly debating the train of an export regulate called the overseas affirm product rule, which would impact companies in U.S. allies including Japan’s Tokyo Electron (TOELY+0.42%) and Dutch chip machine-maker ASML (ASML-2.21%). The rule does no longer allow the export of any staunch to any country whether it is manufactured with a certain percentage of U.S. intellectual property parts. It was later reported that some allies can be exempt if the rule is expanded.

“He’s [Trump] likely to scramble further than the Biden administration has gone with regard to the imposition of blanket tariffs across a worthy wider variety of goods,” Dong said.

Trump has already imposed restrictions on chip sales to China

Beneath Trump’s first administration, Chinese language tech giant Huawei was placed on the U.S. Entity Record in 2019 after the government obvious it had “been aroused by activities contrary to the national security or overseas coverage pursuits of the United States.” Other Chinese language semiconductor companies have been added to the checklist to restrict U.S. companies from sending tools for advanced chip manufacturing.

Trump extended the ban on Huawei’s merchandise thru 2021, and trade restrictions on it and other Chinese language tech companies have easiest tightened below the Biden administration.

Earlier than the election, U.S.-based chip tools makers were reportedly bracing for extra export controls below the Biden administration, telling suppliers they afraid about risking their supplier status for the train of certain parts supplied by China. The companies also reportedly told suppliers no longer to have Chinese language investors or shareholders.

“In the occasion you glance at the geopolitical landscape, I think it’s clear that the U.S. will proceed to apply strain on their allies for extra restrictions,” ASML chief government Christophe Fouquet said in October. “The ask is, what is correct for the Netherlands? What is correct for Europe?”

Trump isn’t all for defending Taiwan

In the direction of his most latest campaign for the presidency, Trump said he would impose tariffs on chips from Taiwan, which could have a heavy impact on global chipmaking, as a majority of the world’s most advanced chips are fabricated by Taiwan Semiconductor Manufacturing Company (TSM-1.14%). The Taiwanese-chipmaker counts Nvidia (NVDA+4.08%) and Apple (AAPL-0.35%) as major customers.

In October, Trump accused Taiwan of stealing the U.S. chip trade all thru an appearance on the The Joe Rogan Skills podcast — a level he also made in July all thru an interview with Bloomberg Businessweek. In response to a ask about supporting Taiwan against Chinese language aggression, Trump said the island “took our chip industry from us.”

“I mean, how tiring are we,” Trump said. “They took all of our chip industry. They’re immensely wealthy.”

Instead, Trump said, Taiwan ought to be paying the U.S. to give protection to it.

“I don’t think we’re any thoroughly different from an insurance coverage,” Trump told Bloomberg. “Why? Why are we doing this?”

Trump isn’t a fan of the Chips Act

In the direction of his interview with Rogan, Trump also criticized the U.S. CHIPS and Science Act, which was passed by the Biden administration in 2022 — partly to spur domestic advanced chip manufacturing.

“That chip deal is so bad, we attach up billions of dollars for rich companies to advance and borrow the money and produce chip companies right here, and they’re no longer going to give us the staunch companies anyway,” Trump said on the podcast, adding that the U.S. will have to instead attach tariffs on chips coming into the U.S.

Over a dozen chipmakers, including U.S.-based Intel (INTC+7.63%), Taiwan-based TSMC, and South Korea-based SK Hynix, are accrued awaiting billions of dollars in funding and loans from the U.S. CHIPS Act to produce semiconductor hubs all thru the U.S.