Successive US administrations have been chuntering about encircling, outflanking or wrongfooting China’s economy for so long it’s quite startling when one seems to mean it. The Biden administration’s announcement on October 7 of new semiconductor export controls achieved what Donald Trump failed in four years of flailing about with trade policy — it credibly threatened that the US and China, at least their high-tech sectors, will be decoupled by force. The prophesied “weaponised interdependence”, the exploitation of trade and finance linkages to exert geopolitical pressure, now appears to be here.The breadth of the controls was a big advance on Trump’s earlier measures. In particular, the prohibitions on US citizens and green card holders working in China’s semiconductor industry meant hundreds of employees, including from the world-leading Dutch manufacturer ASML, stopping work within days.
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