Micron primarily manufactures modern memory chips that are used in computers and smartphones, among other things.
(Photo: Bloomberg)
The trade war between the US and China is entering a new round. This time, the focus is on US memory chip manufacturer Micron. The Chinese Cyber Security Authority (CAC) banned operators of infrastructure facilities from using the US company’s chips on Sunday evening. The products posed massive security risks, it said.
The CAC did not give any details. The decision was met with sharp criticism in the United States. “We clearly reject unfounded restrictions,” the US Department of Commerce said. This approach is not in line with Chinese pledges to open markets and adhere to transparent rules.
The prices of US chip companies fell on the stock exchange. Chinese and South Korean manufacturers, on the other hand, received an upswing. However, the course changes were kept within limits. Experts do not expect the Chinese government’s decision to trigger any major upheavals in the market.
Tensions between the US and China have increased again in recent months. Micron is the first US chip manufacturer to be caught in the crosshairs of the Chinese government.
The US had previously imposed export restrictions on chip machines and other parts to prevent US products from being used in the Chinese defense industry. The US Department of Commerce has now announced that it will speak directly to the authorities in Beijing. “We will also consult with key allies and ensure we work closely together to prevent disruptions in the memory chip market that could be triggered by the Chinese decisions.”
restrictions not surprising
In industry circles it was said that the action against Micron did not come as a complete surprise. Chinese state media spoke of an isolated case that had to be viewed against the background of national security and not geopolitical decisions.
However, prominent Chinese commentator Hu Xijin pointed to a political issue: the Washington government encourages US companies to do things that affect China’s security. That’s why she suspects Chinese companies of doing the same thing. “The whole world should beware of the US,” tweeted the former editor-in-chief of the state-run Global Times newspaper.
The Chinese government has classified the communications and transport sectors, among others, as “critical”, but has not made it clear which companies are involved. Micron primarily manufactures modern memory chips that are used in computers and smartphones, among other things.
However, the direct effects for Micron are likely to be manageable because the business with server chips plays a comparatively minor role, the Jefferies experts wrote. It can be assumed that telecommunications companies and authorities are not among the main customers. The Bernstein experts put the possible drop in sales at two percent.
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