The United States introduces new export restrictions to slow down the Chinese chip industry. On Friday, the Bureau of Industry and Security (BIS), a division of the US Department of Commerce, announced a package of measures to prevent China from building new supercomputers or developing advanced artificial intelligence systems. The Chinese government uses such technology for military purposes, according to the Americans. That is a threat to national security, according to the Biden administration. In addition, China is violating human rights by creating a surveillance state, the Americans say. Equipment or software required for the production of advanced processors and memory chips now requires an export license. In practice, this often amounts to a ban. Previous export restrictions have targeted specific companies such as Huawei or SMIC, China’s largest chip maker. These new measures should keep the entire Chinese chip industry about ten years behind the rest of the world. The shock was felt on the stock exchanges in New York and Shenzen on Monday. Share prices of US chip suppliers, such as Applied Materials and Lam Research, fell nearly 5 percent. SMIC lost more than 4 percent of its stock market value, smaller companies in the sector recorded losses of 10 to 20 percent. Applied Materials and Lam Research provide indispensable equipment for chip production. The software to design chips is also often of American origin. The US tech companies are now losing their Chinese turnover – sometimes a third of the total turnover. That loss limits their investment in innovations, and the restrictions empower the Chinese government to develop proprietary technology with even greater dedication. Also read: Why the whole world is counting on chips from Taiwan Own semiconductor industry China wants to be less dependent on the import of chips and has been trying to set up its own semiconductor industry since 2015. Despite huge support packages from the Chinese state, this so-called Made in China 2025 plan has not yet got off the ground. Chinese chip manufacturers are not allowed to use American technology that allows them to produce computing chips with an accuracy of 14 nanometers (14 millionths of a millimeter). By comparison, the most advanced chips made by Samsung and TSMC have an accuracy of 3 nanometers – more than three chip generations later. The US is also restricting the production of memory chips in China. That is where the limit lies with chips that consist of 128 different layers. The most advanced memory chips from the American chip manufacturer Micron, intended for SSD storage, already consist of more than 200 layers . Lithography machines are a crucial part of chip factories. ASML, producer of such machines, is still making an inventory of the potential damage of the measures, a spokesperson for the Veldhoven company said. As a Dutch company, ASML is not directly under the jurisdiction of US export restrictions, but problems can arise if, for example, replacement parts have to come from the US. In the meantime, the Americans are increasing the pressure on the Dutch government and the EU to prevent ASML from also exporting conventional lithography machines to China. So far this has not been answered. A version of this article also appeared in the newspaper of October 11, 2022