Just days after the U.S. and China agreed to a 90-day pause in their escalating trade war, the fragile ceasefire is already cracking. The Chinese government is slamming a new U.S. move to block Huawei’s advanced Ascend computer chips, calling it a violation of both international norms and the spirit of recent negotiations.
📉 The Ban That Broke the Calm
On Monday, the U.S. Commerce Department’s Bureau of Industry and Security (BIS) issued new guidance declaring Huawei’s Ascend chips off-limits for global use. The rationale? The chips likely include U.S. technology, putting them under the umbrella of American export controls.
“These chips were likely developed or produced in violation of U.S. export controls,” the agency said, warning that any company using them could face U.S. enforcement actions.
The chips are integral to China’s ambitions in artificial intelligence — especially its DeepSeek project, a high-powered effort to challenge Western AI dominance. Some analysts see it as China’s answer to Nvidia — and the U.S. clearly took notice.
Beijing Hits Back — Hard
China’s Ministry of Commerce quickly condemned the move. Spokesperson He Yongqian said the decision “is not conducive to long-term, mutually beneficial, and sustainable cooperation.”
He added that the U.S. needs to “immediately correct its erroneous practices” and stop weaponizing technology regulations under the guise of national security.
Despite the rising tensions, Beijing followed through on one part of the Geneva truce: it lifted its export ban on rare earth minerals — vital elements for U.S. tech and defense industries. But that olive branch came with thorns.
⚙️ Old Tariffs, New Frustrations
Alongside the chip ban, China is also frustrated by the U.S.’s refusal to lift existing tariffs on Chinese steel and aluminum. President Trump recently reimposed 25% tariffs on those metals under Section 232 of the 1962 Trade Expansion Act — citing national security concerns.
He Yongqian called the tariffs “outdated and discriminatory,” urging Washington to abandon what he called an “abuse of security-related trade measures.”
Meanwhile, China continues to impose a 10% tariff on U.S. goods during the 90-day negotiation period, while the U.S. is hitting Chinese imports with a 30% tariff, which includes:
A 10% global baseline tariff
A 20% surcharge tied to efforts to reduce fentanyl smuggling
💥 Huawei at the Heart of a Tech Cold War
This isn’t just about tariffs. The Huawei ban makes it clear: the U.S.-China conflict is increasingly about technology dominance. From AI chips to 5G, semiconductors, and quantum computing — both superpowers are racing to control the future.
Huawei’s Ascend chips symbolize that ambition. They’re built for AI systems, data centers, and military-grade computations — and they’ve become central to China’s effort to build tech independence after years of U.S. sanctions and blacklisting.
If successful, they could reshape the global AI market and reduce reliance on American firms like Nvidia, Intel, and AMD.
🧭 So What Happens Now?
Though officials struck a diplomatic pause last weekend, this week’s developments highlight just how unstable the foundation really is. Behind closed doors, both sides remain deeply divided on key issues:
The U.S. wants stronger Chinese action on fentanyl smuggling, better IP protections, and reduced industrial subsidies.
China wants Washington to end tariffs, drop tech restrictions, and allow Chinese companies to compete globally.
With 90 days to find common ground, every move matters — and this week’s chip crackdown could be a major setback.
📌 The Bottom Line
The truce may have bought time, but the tech war is advancing with or without tariffs. The U.S. just drew another red line with Huawei, and China’s not backing down.
This isn’t just a trade fight — it’s a battle for technological supremacy.