TLDRs;
- China launches dual probes into U.S. chip sector, targeting anti-dumping and alleged discriminatory practices.
- Investigations coincide with U.S. sanctions adding 23 more Chinese firms to its entity list.
- Semiconductor imports to China fell 30% in early 2023, highlighting impact of U.S. export controls.
- Beijing accelerates multibillion-dollar investments to achieve chip self-sufficiency by 2030.
China has opened two separate investigations into the American semiconductor sector, escalating friction just days before high-stakes trade talks with Washington.
The Ministry of Commerce confirmed that it will conduct an anti-dumping probe into U.S.-made analog integrated circuit chips, a move that directly affects industry giants such as Texas Instruments and Analog Devices.
In addition, Beijing launched a parallel investigation into what it calls discriminatory practices by the United States against Chinese chip companies. These actions come on the heels of Washington expanding its sanctions, adding 23 China-based firms to the U.S. entity list, restricting their access to American technologies.
Timing Signals Diplomatic Pressure
The investigations are widely seen as a calculated response to mounting U.S. restrictions. They were announced just ahead of a scheduled meeting in Madrid between U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng.
Analysts note that the timing mirrors a long-standing pattern in trade disputes, regulatory pressure used as leverage to influence negotiations.
By opening dual investigations, China is sending a message that it is prepared to counter U.S. sanctions with its own legal and diplomatic tools.
Semiconductor Battle Deepens
Semiconductors remain the core battleground in the technological and economic rivalry between the two nations. While China consumes about $380 billion worth of chips annually, it still depends heavily on foreign suppliers due to its relatively limited domestic manufacturing capacity.
The U.S., meanwhile, has doubled down on efforts to curb Beijing’s ambitions. Washington recently expanded its blacklist to 32 global entities linked to China’s semiconductor sector, accusing some of aiding Semiconductor Manufacturing International Corporation (SMIC) and others of supplying Russian defense projects.
Such restrictions have hit U.S. companies as well, with the Federal Reserve Bank of New York estimating over $130 billion in market value losses for American semiconductor firms from earlier rounds of export controls.
China’s Push for Self-Sufficiency
Despite its dependence, China has invested heavily in achieving chip independence by 2030. Through its National Integrated Circuit Industry Investment Fund, Beijing has already poured billions into domestic chipmaking, with $21 billion allocated in its first phase and nearly $29 billion in its second.
Still, U.S. export bans are beginning to bite. Chinese semiconductor imports fell almost 30% in early 2023, disrupting industries from smartphones to electric vehicles. By opening the new probes, Beijing aims not only to challenge American restrictions but also to buy time as it accelerates its domestic production push.
Future Outlook
The anti-dumping investigation is expected to run for about a year, while the anti-discrimination inquiry could conclude in roughly three months. Together, they add a new layer of uncertainty to an already tense economic relationship.
As both nations prepare for their Madrid meeting, semiconductors will likely remain the central flashpoint in the U.S.-China rivalry, a contest where trade, technology, and geopolitics converge.
