China has escalated its ongoing feud with the United States by urging users of sensitive computer equipment to refrain from purchasing products from Micron Technology Inc., the largest US memory chipmaker. The Cyberspace Administration of China claimed that Micron products pose “serious network security risks” that could jeopardize China’s information infrastructure and national security. However, the statement provided no specific details to support these claims.

Chinese Government’s Warning against Micron Products

China’s Cyberspace Administration instructed operators of critical information infrastructure in the country to cease buying products from Micron Co. The move intensifies the growing tensions between the two countries, particularly regarding technology and security issues.

China’s decision to restrict access to advanced chipmaking technology aligns with the US, Europe, and Japan’s efforts to limit Chinese access to such technology, citing concerns that it could be utilized for military purposes. Notably, China’s aggressive stance towards Taiwan, Japan, and neighboring countries has further strained its relationship with the international community.

China’s Struggle for Retaliation

While Chinese officials have issued warnings about potential consequences, they face challenges in devising retaliatory measures that would not harm China’s domestic industries, including smartphone manufacturers, and its pursuit of developing its own processor chip suppliers. The Chinese government is undergoing an official review of Micron under the nation’s increasingly stringent information security laws. This review was announced shortly after Japan joined the US in imposing restrictions on Chinese access to technology for processor chip manufacturing based on security grounds.

Raids on Consulting Firms and Enforcement of Legal Restrictions

The recent police raids on consulting firms, such as Bain & Co., Capvision, and Mintz Group, have unsettled foreign companies operating in China. These raids have not been explained by Chinese authorities, but they emphasize that foreign companies must comply with the country’s laws. Business groups and the US government have urged Chinese authorities to clarify the newly expanded legal restrictions on information and provide details on their enforcement.

China’s Intentions and Technological Development

China seeks to project a sense of reassurance to foreign companies by stating its commitment to openness and compliance with Chinese laws and regulations. The country encourages enterprises and various platform products and services from different nations to enter the Chinese market. Despite accusations from President Xi Jinping that the US aims to impede China’s development, Beijing has been cautious in retaliating, likely to prevent disruption to its domestic industries, which are major players in global smartphone and consumer electronics assembly.

Nonetheless, China is investing significant funds to expedite chip development and reduce its reliance on foreign technology. While Chinese foundries can produce low-end chips for automobiles and home appliances, they are not yet equipped to support advanced applications in smartphones and artificial intelligence.

Implications of the US-China Conflict

The intensifying conflict between the US and China raises concerns about the possibility of decoupling, where different regions adopt incompatible technology standards, leading to a fragmented global tech ecosystem. Such a scenario would increase costs and impede innovation. US-China relations are currently at their lowest point in decades, primarily due to disputes over security, China’s handling of Hong Kong and Muslim ethnic minorities, territorial disputes, and China’s substantial trade surpluses with the US.