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Fujian Jinhua Reportedly Stopping Production Months After US Killed Exports to Chinese DRAM Maker (Update)

(Image credit: Nor Gal/Shutterstock)


Update, 1/30/19, 8:45 a.m. PT: The Financial Times has reported that Fujian Jinhua will stop production in March as a result of the U.S.' export restrictions. According to FT, which cited two people familiar with the DRAM maker's dealings, Fujian Jinhua is "rapidly running out of imported materials vital for keeping its fabrication plant running."

Original article, 10/30/18, 7:12am PT:

There's some more economic drama (pun intended) rising between the U.S. and China. The U.S. Department of Commerce announced yesterday that U.S. companies will no longer be allowed to export goods to a Chinese DRAM maker called Fujian Jinhua Integrated Circuit Company because it believes the company "poses a significant risk of becoming involved in activities that are contrary to the national security interests of the United States."

The announcement follows increasing tensions between the U.S. and China. Earlier this year the U.S. threatened to enforce tariffs on $34 billion worth of Chinese goods. That figure quickly grew to $200 billion as the list of affected products was updated, and many have feared that the tariffs could lead to higher prices for tech products or even hinder the U.S. semiconductor industry (although we don't know for sure how tech products will be affected).

But the restriction of exports to Fujian Jinhua actually relates to a much older problem: Accusations of Chinese businesses stealing American trade secrets to shift the balance sheets (and balance of power) in their favor. Micron has repeatedly accused Fujian Jinhua of stealing its trade secrets.
The U.S. government didn't specifically mention Micron in its announcement but seems that to be taking action against such possibilities. 

The department explained:

"Jinhua is nearing completion of substantial production capacity for dynamic random access memory (DRAM) integrated circuits. The additional production, in light of the likely U.S.-origin technology, threatens the long-term economic viability of U.S. suppliers of these essential components of U.S. military systems."

It's unclear how much of this concern is legitimate, but either way, the Department of Commerce has officially made Fujian Jinhua a no-go for U.S. companies, which could hinder its ability to manufacture DRAM. We'll probably see how the Chinese government responds to this escalation of economic tension from the U.S. in the coming days, weeks and months.

  • Brian_R170
    I guess RAM prices aren't coming down any time soon.
    Reply
  • bit_user
    This seems like too little, too late.

    Unless you have standing to sue, there doesn't seem to be much one can do about industrial espionage, after the fact.
    Reply
  • Zaporro
    Using national security again as excuse to discriminate other companies and countries...
    Reply
  • stdragon
    21446707 said:
    Using national security again as excuse to discriminate other companies and countries...

    That in fact, is the role of a sovereign state to look after its own interests. Do they not teach history and civics when you were in school?! Yes, nations have borders, and their own laws!
    Reply
  • stdragon
    https://www.rt.com/news/442625-china-prepares-war-us/
    Reply
  • kenjitamura
    21446858 said:
    21446707 said:
    Using national security again as excuse to discriminate other companies and countries...

    That in fact, is the role of a sovereign state to look after its own interests. Do they not teach history and civics when you were in school?! Yes, nations have borders, and their own laws!

    Kind of hard to feel bad for a company that was so engrossed in the thought of increasing its profits it was willing to ignore potential American workers to expand into a country that didn't really have the concept of intellectual property and had a known history of IP infringement.

    This outcome for the company should have been expected and is in my opinion deserved. And now it's dragging down our relations with a potential future super power in its attempt to protect its own interests which further throws the average American under the bus.
    Reply
  • stdragon
    21447098 said:
    21446858 said:
    21446707 said:
    Using national security again as excuse to discriminate other companies and countries...

    That in fact, is the role of a sovereign state to look after its own interests. Do they not teach history and civics when you were in school?! Yes, nations have borders, and their own laws!

    Kind of hard to feel bad for a company that was so engrossed in the thought of increasing its profits it was willing to ignore potential American workers to expand into a country that didn't really have the concept of intellectual property and had a known history of IP infringement.

    This outcome for the company should have been expected and is in my opinion deserved. And now it's dragging down our relations with a potential future super power in its attempt to protect its own interests which further throws the average American under the bus.

    The Cold War never really ended. Rather, it was on hiatus.

    I don't condone war, but all signs point to a kenetic conflict between China, Russia, US/Europe, and India. I'm not talking about the proxy wars in the ME, rather major naval conflict if not a limited thermonuclear exchange to military assets. Anything beyond that and you can kiss everything you know and love goodbye.

    It's sad. There's no need for any of this as it's a giant waste of resources and a wrong step in human endeavor. But at the day nations must do what they must to protect their own self interests. Hopefully rationality prevails and we can continue to live in a world of peace. But to expect as such would be folly and shrouded in naivety.
    Reply
  • johnbl
    pretty weak argument calling it a national security issue. Military= national security. The military uses computers, computers use RAM. RAM manufacture is a national security issue.

    you could say that about anything the military needs. Military= national security, military uses green paint. Green paint manufacture is a national security issue. LOL

    they use toilet paper also.
    Reply
  • stdragon
    Just be thankful we're not in a period of wartime as enacted by congress. At that point, quite literally everything is national security issue, from food, metals, to other natural resources such as rubber (tires). Please see the history of WW2.

    During the Cold War, it wasn't nearly as bad, but yeah, national security against espionage was far more heightened.
    Reply
  • bit_user
    21446865 said:
    https://www.rt.com/news/442625-china-prepares-war-us/
    Oh man. Russia Today? I seriously wouldn't trust anything they write.

    Free press doesn't exist in Russia. Everything from Russian media outlets is basically in line with the Kremlin's strategic interests.
    Reply