China’s ban on Micron chips is ‘economic coercion’ and won’t be tolerated, says Gina Raimondo

Commerce Secretary Gina Raimondo said the US “won’t tolerate” the recent decision by Chinese authorities to ban chips by Micron Technology Inc. in some critical sectors, using her sharpest language yet to describe Washington’s reaction.

“We see it as, plain and simple, economic coercion,” she said, using a phrase both sides have lobbed at each other amid recent tensions. “We won’t tolerate it, nor do we think it will be successful.”

The latest technology tensions between the two global powers kicked off last Sunday, when the Cyberspace Administration of China warned operators of key infrastructure against buying Idaho-based Micron’s chips, saying it found “relatively serious” risks after concluding a review it announced in March. That followed a sweeping ban by the US in October on exports to China of high-end chips and the technology to make them. 

Raimondo’s comments Saturday come after the two sides had a chance this week to air their grievances in person and pledged to keep communications open going forward. Raimondo met with her counterpart, Wang Wentao, in Washington on Thursday, followed by a similar meeting Friday with United States Trade Representative Katherine Tai.

Those meetings are part of a broader intention by the President Joe Biden’s administration to restore high-level discussions with Beijing, including potential visits to China by Treasury Secretary Janet Yellen and further direct talks between Biden and President Xi Jinping.   

The US commerce chief reiterated Saturday that Washington sees the action on Micron as having “no basis in fact” and that the US is engaging with its partners in how to respond. 

South Korea, a major trade partner with China and security partner with the US, is stuck in the middle of the spat as its memory chipmakers Samsung Electronics Co. and SK Hynix Inc. are poised to potentially gain from Micron’s loss of market share in China. Both Washington and Beijing have been lobbying their counterparts in Seoul. 

Wang’s commerce ministry said in a statement over the weekend that he had met South Korea’s Trade Minister Ahn Duk-geun on Friday and that they had agreed to strengthen dialogue and cooperation on semiconductor supply chains. A separate statement from Ahn’s office Saturday about the talks made no reference to semiconductors, only “stabilizing the supply and demand of key raw materials and components.”

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