Top Democrats slam Trump for delaying export curbs on China

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By Alexandra Alper

WASHINGTON (Reuters) -Top Senate Democrats including Senate Minority Leader Chuck Schumer took aim at the Trump administration for suspending a measure that blocked thousands of Chinese companies from accessing U.S. technology in the last round of trade talks with Beijing, calling it a “giveaway of key national security tools.”

The rule, unveiled on September 29, sought to stop sanctioned Chinese companies from using a network of subsidiaries to obtain key American equipment they were otherwise barred from receiving. 

But President Donald Trump last month agreed to delay by a year that rule as part of a deal with Chinese Leader Xi Jinping in exchange for Beijing suspending for the same period its restrictions on rare earth mineral exports, key ingredients for tech that are primarily controlled by China.

In a letter dated Wednesday and first reported by Reuters, the senators, including Ron Wyden, called on Trump to reimpose the rule, arguing its delay puts “American-developed advanced computing technologies at risk of advancing China’s agenda instead of our own.” 

“The suspension of these controls undermines U.S. national security and will make it far more difficult to stem the illicit diversion of American-made semiconductors and other advanced technology to Chinese state-affiliated entities,” they wrote. “We urge you to reinstate these controls and end your giveaway of key national security tools.” 

The White House defended itself on Thursday, arguing that the “Trump administration has implemented a rigorous export control regime to safeguard our economic and national security,” according to a statement to Reuters from White House spokesman Kush Desai.

The letter is the latest blowback against the Trump administration over its suspension of the rule, which was hailed by China hawks from both parties. 

It barred firms at least 50% owned by previously sanctioned companies from receiving U.S. tech exports, hitting roughly 20,000 additional Chinese firms with U.S. export restrictions, according to a recent report from WireScreen.

The one-year suspension, the Democrats argued in their letter, reopens a “loophole” and provides “a year-long opportunity for affiliates of blacklisted foreign firms to restructure in order to evade the rule.” 

The delay, they added, is part of a troubling pattern of Trump choosing “to trade away national security in search of quick handshake ‘deals’ to mitigate the harms of trade wars of your own making.” 

“We urge you to reconsider this misguided strategy and ensure that our nation’s export controls are no longer used as a bargaining chip,” said the letter, which was also signed by senators Elizabeth Warren, Chris Van Hollen, Jeff Merkley, Ben Ray Lujan, Andy Kim and Catherine Cortez Masto. 

(Reporting by Alexandra Alper in Washington; Editing by Leslie Adler and Matthew Lewis)