Xinjiang firms blacklisted by US seen ‘shifting orders within China’ to minimise impact
- Biden administration confirms ban on US imports of metallurgical-grade silicon products from one Xinjiang company, and adds additional companies in Xinjiang to Entity List
- But one analyst says ‘Chinese companies have been preparing for any US sanctions since the trade war began’, and does not expect targeted businesses to be hard hit by latest US move
The US ban on imports and restricted exports involving five Chinese companies will not have an outsized impact on them, because producers can simply change the production origin by shifting orders elsewhere in the country, according to a Chinese analyst.
Some of the companies on the Entity List are major manufacturers of monocrystalline silicon and polysilicon, which are used in solar-panel production. Metallurgical-grade silicon contains at least 98 per cent silicon, and most of it is used in industrial production. By comparison, it is not as pure as electronic-grade silicon, which is needed to make electronics such as computer chips.
I believe Chinese companies have been preparing for any US sanctions since the trade war began
Under such restrictions, US companies are required to get a licence to sell products or technology to blacklisted companies, but such exceptions are rarely granted.