US-China Tech Export Approval Rate Proof of Policy Failure, Says Ex-Pentagon Analyst
US tech sanctions against China, as harsh as they sound, are not very strong. According to new information, official data from the Department of Commerce shows that the United States has approved nearly all technology export requests to China. Wall Street Journal report.
Data show that 95% of exports to China required an export license in 2020, with less than 0.5% approved. By 2021, the approval rate has dropped to 88%. This means that nearly nine out of ten technology export licenses were still greenlit.
The purpose of these sanctions is to deny China access to technology that may be intended (or repurposed) for use in military equipment. According to critics who have seen the numbers, this implementation has fallen by the wayside. Critical US semiconductors, AI technology and even aerospace components are approved for export, according to the WSJ.
A prominent critic of these lax regulations is former Pentagon China export control analyst Steve Coonen. Coenen, who nearly resigned from his Pentagon position a year ago, sees the numbers highlighted by the WSJ as evidence of a critical policy failure.
The crux of the matter is the pressure on the Department of Commerce to carry out its core purpose of promoting U.S. exports, and how this now overwhelms the issue of export controls ( especially with respect to China).
Not everyone believes the current policies are worth pushing. Some fear that U.S. export controls will hurt U.S. businesses while offering distinct opportunities for rivals in tech nations such as Japan, Germany and South Korea.
The WSJ report, which cites Texas Rep. Michael McCall’s findings, found that blacklisted Chinese companies such as Huawei and SMIC killed 1,000 people between November 2020 and April 2021. It highlights the fact that it has been issued export licenses worth over $100 million. Instead of being automatically denied exports, you only need to apply for an export license, which is often granted. It is also believed that non-blacklisted companies may be used to import technology into China and be diverted to blacklisted companies.
Since 2021, SMIC has been shipping 7nm chips based on technology copied from TSMC. The US export control process was considered a major hurdle for China to acquire advanced semiconductors (and the means to manufacture them).
Successive U.S. administrations have gnashed their teeth on China, but trade statistics suggest that this policy has not been strictly enforced and is open to debate.
