New U.S. export controls on China's semiconductor industry will shatter Chinese President Xi Jinping's ambitions to close China's gap with global peers in the short term. They could also lead to more aggressive Chinese retaliation once his political leadership is cemented. On Oct. 7, the U.S. Commerce Department announced new regulations to block China's access to chipmaking technology and gear that can be used to manufacture cutting-edge logic and memory chips. The regulations also block exports to China of artificial intelligence (AI) and high-performance computing chips (i.e., chips used in supercomputers). Although the regulations have been in the works for months, the announcement came less than 10 days before the opening of the 20th National Congress of the Communist Party of China, during which Xi is expected to formally be granted a third five-year term as the Party's leader. The timing of the moves meant that China's semiconductor industry --...
