(Yicai) Dec. 4 -- Industry associations that represent Chinese internet, semiconductor, automobile, and communications firms have said they strongly oppose the US government's latest restrictions on semiconductor exports to China, warning businesses that US chips are unsafe and unreliable.

On Dec. 2, US authorities added 136 Chinese companies to a so-called Entity List, a directory of foreign individuals, businesses, and organizations that the US government considers a national security concern, limiting their ability to produce 24 types of chipmaking equipment, three software tools, and high-bandwidth memory chips.

The China Semiconductor Industry Association said yesterday that the US move will not only damage the interests of Chinese companies but also disrupt the global semiconductor industry’s supply chain by raising costs. The Internet Society of China said the US is abusing export controls to unjustly block and suppress China, likely undermining trust in American chips.

To ensure the secure, stable, and sustainable development of China’s internet industry, the ISC urged domestic companies to take countermeasures, exercise prudence when buying US chips, and seek to widen cooperation with chipmakers in other countries and regions.

The China Association of Automobile Manufacturers said trust and confidence in US auto chips is being shaken. It warned that US auto chips are no longer reliable and safe, so Chinese carmakers should be cautious when buying chips from US firms.

The China Association of Communications Enterprises said the curbs have severely damaged international trade rules and pose a substantial threat to the security and stability of the country’s information and communications industries.

The CACE called on the Chinese government to conduct a security review of the supply chain of critical information infrastructure and take effective measures to ensure the safe and stable operation of key infrastructure.

China’s Ministry of Commerce also protested the US’ move yesterday. “The semiconductor industry is highly globalized, and the US’ abuse of regulatory measures severely hinders normal economic and trade exchanges between countries, undermines market rules and the international economic order, and threatens the stability of the global industrial and supply chains,” a ministry spokesperson said.

All companies along the chip industry’s supply chain, including those from the US, have been seriously affected by this move, the spokesperson noted, adding that China will act to safeguard its legitimate rights and interests.

“Countries and regions play different roles in the global semiconductor industry chain, and no single entity can control or dominate the entire supply chain,” Li Xuan, a senior technology analyst at Haitong Securities, told Yicai. Adding chipmaking equipment and material manufacturers to the Entity List presents short-term challenges but could also be a long-term positive for the industry, he noted.

The commerce ministry also announced late yesterday that it will ban the export of dual-use items related to gallium, germanium, antimony, and super-hard materials to US military users or for military purposes to safeguard China’s national security and interests. It also tightened examinations of graphite exports to the US.

Editor: Futura Costaglione