The Trump administration has confirmed that two major Chinese companies — chipset maker SMIC and oil producer CNOOC have been added to the trade blacklist, alleging them to be Chinese military companies.
The Department of Defence has designated four companies for being owned or controlled by the People’s Liberation Army. The list includes Semiconductor Manufacturing International Corp (SMIC), China National Offshore Oil Corp (CNOOC), China Construction Technology Co. Ltd, and China International Engineering Consulting Corp.
With the addition of these four companies to the trade blacklist of the United States, there are now 35 countries on the list. Companies on the list are barred from procuring or using technologies or goods made in the United States.
A couple of months ago, it was reported that the Pentagon was holding discussions to determine id the SMIC should be added to the Commerce Department Entity List. SMIC is one of the biggest players in China when it comes to chip manufacturing.
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Semiconductor Manufacturing International Corp (SMIC) heavily relies on the United States for supplies and getting blacklisted will make it a bit difficult for the company and will also hinder China’s plan to boost its chipset manufacturing technology.
However, blocking these companies from trading with US-based firms also hurts the suppliers, in this case, the US companies, as several of the companies highlighted in their request to the government to allow them to continue doing business with Huawei after the Chinese giant was added to the Entity List in May last year.
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