© Reuters. FILE PHOTO: Chinese and US flags flutter in front of a company building in Shanghai, China Nov 16, 2021. REUTERS / Aly Song

By Chris Sanders

WASHINGTON (Reuters) – China on Thursday criticized the United States for blacklisting a dozen Chinese companies over national security and foreign policy concerns and, in some cases, cited its help in developing the quantum computing efforts of the Chinese military.

The Chinese additions to the U.S. Department of Commerce’s blacklist come amid mounting tensions https://www.reuters.com/world/asia-pacific/biden-administration-invites-taiwan-its-summit-democracy-2021-11-24 between Beijing and Washington on Taiwan’s status and trade issues.

The ministry also announced that several units and individuals from China and Pakistan have been added to the Ministry of Commerce’s list of entities for contributing to Pakistan’s nuclear activities or ballistic missile program.

A total of 27 new companies from China, Japan, Pakistan and Singapore were added to the list.

China firmly rejects the sanctions against Chinese companies and will make solemn statements to the United States, Shu Jüting, a spokesman for the Chinese Ministry of Commerce, said at a press conference on Thursday.

Trade Minister Gina Raimondo said in a statement on Wednesday that the new lists will help prevent US technology from supporting the development of Chinese and Russian “military advances and non-proliferation interests such as Pakistan’s unsecured nuclear activity or the ballistic missile program”.

The Chinese Embassy in Washington accused the United States of “using the general concept of national security and abusing state power to suppress and restrict Chinese companies by all possible means.

“China firmly rejects this,” said embassy spokesman Liu Pengyu.

He said the United States should follow “the spirit” of a virtual meeting between US President Joe Biden and Chinese leader Xi Jinping https://www.reuters.com/world/biden-raised-concerns-over-xinjiang-tibet -hong -kong-xi-warns-taiwan-red-line-2021-11-16 last week and “hit China halfway instead of going the wrong way.”

China will take all necessary steps to defend its companies and reserve the right to counter the sanctions, warned Zhao Lijian, spokesman for the Chinese Foreign Ministry, at a briefing on Thursday.

The US Department of Commerce announced that Hangzhou Zhongke Microelectronics Co Ltd, Hunan Goke Microelectronics, New H3C Semiconductor Technologies Co Ltd, Xi’an Aerospace Huaxun Technology, and Yunchip Microelectronics for “supporting the military modernization of the Liberation Army.”

In addition, Hefei National Laboratory (NYSE 🙂 for Physical Sciences at Microscale, QuantumCTek and Shanghai QuantumCTeck Co Ltd have been added to the list for “Acquisition and Trial of Acquisition of US Items in Support of Military Applications”.

The eight Chinese companies were listed to prevent US technology from being used to help China develop quantum computing applications for its military.

The Ministry of Commerce wants to prevent the Chinese military from developing its anti-stealth technology, which could include devices like advanced radars and anti-submarine applications like underwater sensors. The action also prevents US materials from being used to help China break the encryption or develop unbreakable encryption, the Department of Commerce said.

Suppliers to companies on the entity list must apply for a license before they can sell to them, which is likely to be denied.

Separately, the Moscow Institute of Physics and Technology was added to the Ministry of Commerce’s list of military end-users, but the list did not contain any additional information other than that it had manufactured military products.

The entity list has been used increasingly for national security and foreign policy goals since the Trump administration. Chinese telecommunications company Huawei joined in 2019, cutting it off from some key suppliers and making it difficult for them to manufacture cell phones.

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