Treasury Secretary Janet Yellen described her recent visit to Beijing as “productive” in opening a “channel of communication” with China. She should use this channel to push back on China’s Micron chip ban and demand an explanation of the security risks that China believes Micron chips pose.
In May, the Cyberspace Administration of China banned “critical infrastructure” companies from using chips and other products from Micron, a U.S. chipmaker. The order cites “serious network security risks” as its rationale, which parallels U.S. restrictions on Chinese firms such as Huawei and ZTA. While the U.S. restrictions target complete devices, which could potentially capture and relay sensitive data, most Micron products are small memory chips that don’t have the technical capability to pose a similar risk.
Micron produces some more complex products that don’t suffer from this technical limitation. However, the order doesn’t specify what products it applies to and appears to ban the purchase of all Micron products by a broadly defined group of “critical information infrastructure” companies.
It has been suggested that the ban is in retaliation for the 2022 U.S. ban on chip and chipmaking equipment export to China. The United States has raised concerns about spying and industrial espionage, while China has complained of U.S. efforts to damage the growth of its tech firms. The Wall Street Journal suggests that the ban won’t apply to foreign firms using Micron chips for exported products, and the New York Times suggests that the ban may be a move to mitigate the future supply chain risk of the United States banning Micron from selling these chips in China.
The technical reality is that most Micron products cannot present any particular risk to Chinese security or firms. They have no way of distinguishing that they’re in a Chinese system from being in an American (or British, Japanese, or South Korean) one. They are too low level. These chips store small amounts of data that, when combined and connected to other computer components, provide the computer with temporary and longer-term storage. However, they can’t detect state secrets, much less transmit them. The claim that these chips pose this type of threat is akin to blaming a soldier’s foot for firing a weapon: it may be essential to the soldier standing to do so, but it has no direct part in pulling the trigger.
This is not to say that supply chain threats aren’t real. They’re a crucial concern of governments — and companies — worldwide. A nation-state that learns of (or creates) a fault in a small component may be able to attack a more extensive system that relies upon it. For example, if an adversary weakens key bolts in an aircraft or helicopter, they might know certain maneuvers could damage it. Then, in battle, the adversary could force the plane to make these maneuvers to cause it to crash.
This is the same way a low-level product, like most Micron memory, would present a potential system risk. A state could identify a vulnerability in the product that could be exploited to cause maloperation. For example, if a chip was known to fail under certain operating conditions (within its expected operating ranges), this could be used to target a system that relies upon the component. It is important to note here that there would be a risk for anyone using the chip — not just a particular government (unless their chips had targeted defects).
If China has identified a critical defect in Micron chips, the Cyberspace Administration of China should publicly identify it to allow everyone using the chips — including Chinese firms and users of Chinese-manufactured exports — to mitigate whatever risks it may pose. Absent such a notification, it appears that Micron may have become collateral damage in a growing trade war spanning from artificial intelligence to chip product technologies to rare earth minerals to counterfeit goods. Some contend that China seeks to displace the U.S.’s “global leadership position” or infiltrate the country, while others suggest that an all-out war is looming.
Additionally, these actions pose the critical technical risk of decoupling technology between regions, which would damage interoperability and could impair communications, trade and numerous other activities. They also create uncertainty and operational risks for companies in doing business globally, potentially chilling interest in foreign investment — such as Micron’s construction of factories in China — and impairing its economic benefits.
Secretary Yellen should stress to the Chinese government that there are potential long-term consequences to unnecessary technology bans. They impede progress and may lead to technology silos or even a digital Cold War. This could damage the global economy and reduce international trade and economic growth — a result that neither the United States nor China benefit.
