China warns Samsung, SK Hynix against cooperating with U.S. ban

The Chinese government has summoned South Korea’s Samsung and SK Hynix and other tech giants of the United States and Britain “to warn that they could face dire consequences if they cooperate with the Trump administration’s ban on sales of key American technology to Chinses companies,” the New York Times (NYT) reported Saturday (local time).

The NYT reported, by citing people familiar with the matter, that the Chinese government held meetings with major tech companies, including Microsoft and Dell from the United States, the semiconductor makers ARM of Britain, and South Korea’s tech giants, on Tuesday and Wednesday to warn them against cooperating with the Trump administration’s ban on sales of American technology and resources to Chinese companies. The meetings apparently came soon after China’s announcement that it was “assembling a list of ‘unreliable’ companies and individuals.”

“In the meetings this week, Chinese officials explicitly warned companies that any move to pull production from China that seemed to go beyond standard diversification for security purposes could lead to punishment,” the report said. This could be understood as Beijing’s attempt to hit back at the Trump administration, which has taken aim at Huawei, as well as to prevent foreign companies from exiting the country.

With each of the world’s two superpowers appearing to be “crafting new economic weapons to aim at the other,” according to the NYT, foreign companies including South Korea’s tech giants are finding themselves in a dilemma.


Yong Park parky@donga.com