In light of China's new increased cooperation, the U.S. intends to remove some Chinese businesses from a red flag trade list, a top official told Reuters Wednesday.
The world's two largest economies, the U.S. and China, which are embroiled in a bitter trade and technology war, are showing signs of cooperation in this decision.
According to the report, the Chinese government has been more open to allowing U.S. site visits, which has led to the plan to remove them from the so-called "unverified" list, which is anticipated to happen soon.
The number or identities of the entities targeted for removal were unknown to Reuters.
The move might not, however, signal a wider breakthrough.
According to another person familiar with the issue, the Biden administration is also poised to add Chinese memory chipmaker YMTC to a stricter export control list as soon as this week.
As soon as this week, the Chinese businesses will be included on an "Entity List" maintained by the U.S. Department of Commerce.
Once a company is added to the entity list, even low-tech supplies from the U.S. must apply for a special license before sending them to the company. YMTC declined to comment, and when Reuters reached out to the U.S. Department of Commerce for comment outside of business hours, they did not answer right away.
According to a U.S. Commerce Department official, YMTC was one of the dozens of other Chinese companies that were "at risk" of being put on a trade blacklist as early as Dec. 6. Tensions with Beijing increased in October when 31 organizations, including YMTC, were added to a list of businesses that U.S. inspectors have been unable to inspect.
Last week, Alan Estevez, the chief export controls official for the Department of Commerce, said that China had finally changed its tune and was now permitting select companies to be inspected after a protracted period of non-cooperation.
Companies are added to the unverified list because the U.S. cannot conduct on-site visits to establish if they can be trusted to handle critical U.S. technology exports.
The Financial Times reported in October that YMTC had been storing foreign chip manufacturing equipment for months in expectation that the Biden administration was getting ready to take steps that would harm the business.
The U.S.-China tech conflict has escalated once again as a result of this action. Washington is attempting to hinder China's ability to develop technology with military uses, such as artificial intelligence, nuclear weapon modeling, and the development of hypersonic missiles.
As it comes under increased pressure from the U.S. and its allies, China has also been taking measures to strengthen its own technology capabilities.
