The ban on Micron follows police raids on the Chinese offices of international entities such as Mintz Group, Bain & Co., and Capvision. The raids came hot on the heels of fresh trade restrictions by the U.S. and its allies, hampering China’s ability to access semiconductor material and related technology. China, on the other hand, has been pouring billions of dollars into local semiconductor capabilities to accelerate chip development and end its reliance on foreign markets.
Notably, Micron announced plans to invest $3.6 billion at one of its chip fabrication units in Japan accompanied by the G7 summit happening in Hiroshima. The competition over silicon supremacy is at an all-time high, especially when next-gen AI applications, electronic vehicles, and space tech has opened new frontiers for competition. Advanced chips act as the biggest bargain block in this race, and have spilled over into worsening ties between the two countries.
As far as Micron goes, the China import ban could put a sizeable dent in its business, as the company reported over $3.3 billion in sales from the Chinese market in 2022. Over in the U.S., it could worsen the situation for TikTok, China’s crown jewel in the global internet network that also counts the U.S. as its biggest market. The U.S. has repeatedly claimed that the ByteDance-owned social media platform is a security threat, while China continues to deny the charges and calls the allegations an act of baseless commercial retribution.