Expanded blacklist targets advanced computing and hypersonic weapon capabilities

U.S. President Donald Trump's administration has significantly expanded the trade blacklist it inherited from the previous Joe Biden team, aiming to further constrict China's capabilities to develop artificial intelligence and advanced computing, as well as direct military technologies like hypersonic missiles.

The Bureau of Industry and Security (BIS) of the U.S. Commerce Department has added 80 organizations to the Entity List for actions "contrary to U.S. national security and foreign policy."

The additions to the blacklist include entities from the United Arab Emirates, South Africa, Iran and even Taiwan, but most are either Chinese or linked to China.

BIS, in an announcement released Tuesday in Washington, identified key objectives of preventing the Chinese Communist Party from gaining the ability to "acquire and develop high-performance and exascale computing capabilities, as well as quantum technologies, for military applications."

Exascale computing is the latest supercomputer technology enabling further development of AI. It describes computing at speeds of at least 1 exaflop, or 1 quintillion floating-point calculations per second.

Another goal was to "impede China's development of its hypersonic weapons program," essentially, weapons that travel five times the speed of sound or faster and boast enhanced maneuverability to evade defenses.

Among the companies added to the list, six are units of Inspur Group, a major Chinese provider of cloud computing and big data services, which itself has been listed for two years. The units were included due to their stated contributions to the group's development of supercomputers "for military end use, particularly by acquiring or attempting to acquire U.S.-origin items in support of supercomputer projects for the Chinese government and/or military," the BIS said.

One of the six units is Inspur Taiwan, while another is Inspur Software, which is listed on the Shanghai Stock Exchange. The company has not made any public statement so far, while its shares ended Wednesday morning's trading session virtually flat.

The Beijing Academy of Artificial Intelligence and Beijing Innovation Wisdom Technology were also newly designated for their alleged intentions to use American technology for military modernization. The bureau specifically mentioned that these two have developed AI models and advanced computing chips for defense purposes.

Four others -- Henan Dingxin Information Industry, Nettrix Information Industry, Suma Technology and Suma-USI Electronics -- were added for what the BIS described as involvement in the development of exascale supercomputers, "which are capable of processing vast amounts of data at very high speeds and conducting large-scale simulations."

These companies have apparently provided substantial manufacturing capabilities to Sugon, a Chinese server manufacturer also known as Shanghai-listed Dawning Information Industry, which was blacklisted in 2019 "for building supercomputers used by military end users and supporting China's destabilizing military modernization efforts."

Dawning, whose shares also remained virtually flat on Wednesday morning in Shanghai, has not commented publicly on the Trump administration's move. The company admitted in the risk factor section of its latest annual report, published on March 5, that being added to the Entity List and upgraded sanctions in November 2022 have had a "certain influence on the procurement of advanced components from abroad." Meanwhile, it has been "deepening collaboration with local suppliers for years" to cope and provide products to the market.

"American technology should never be used against the American people," Jeffrey I. Kessler, undersecretary for industry and security at the Commerce Department, said in the statement. He stressed that the Trump administration is "sending a clear, resounding message" to safeguard national security "by preventing U.S. technologies and goods from being misused for high-performance computing, hypersonic missiles, military aircraft training, and UAVs that threaten our national security."

The Commerce Department also listed the Test Flying Academy of South Africa (TFASA) to prevent the use of "U.S. items to train Chinese military forces."

Apart from China, the expanded list is also intended to "disrupt Iran's procurement of unmanned aerial vehicles (UAVs) and related defense items" and to "impair the development of unsafeguarded nuclear activities and ballistic missile program" without naming specific regions.

Kessler added that the Entity List is "one of many powerful tools at our disposal to identify and cut off foreign adversaries seeking to exploit American technology for malign purposes."

China had not responded to the U.S. announcement as of publication time.

Source: Asia Nikkei

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