US weighs sweeping export curbs on China-made goods using American software

WASHINGTON: The United States is considering a sweeping plan to curb exports to China made with or containing US software, in what would mark a major escalation in the trade war between the world’s two largest economies, sources familiar with the matter said on Wednesday (Oct 22).

The proposed measure would target a wide range of products including laptops and jet engines. This move comes in retaliation for Beijing’s decision earlier this month to expand its export curbs on rare earth minerals, key to global technology manufacturing.

While still under review, the plan would deliver on President Donald Trump’s threat to bar “critical software” exports to China and impose 100 per cent tariffs on Chinese shipments by Nov 1.

US stock indexes briefly extended losses on the news, with the S&P 500 down 0.8 per cent and the Nasdaq 1.3 per cent lower before paring their declines.

PLAN SEEN AS POSSIBLE TRADE WAR ESCALATION

If implemented, the measure could disrupt global supply chains and international trade, as most manufactured goods rely on US software. “Everything imaginable is made with US software,” one source told Reuters.

A White House official declined to comment, and the Commerce Department did not respond to requests for clarification.

A spokesperson for China’s embassy in Washington said Beijing opposed US “long-arm jurisdiction” and vowed to “take resolute measures” to protect its interests if Washington proceeds “down a wrong path.”

Officials may announce the plan as a signal of intent without fully implementing it, sources said, noting that others within the administration are advocating for a narrower version.