Biden administration launches trade investigation into Chinese semiconductors

Investing.com — The Biden administration is preparing to launch a trade investigation into Chinese-made semiconductors in the coming days, Bloomberg reported on Wednesday.

The move aims to reduce reliance on Chinese technology that US officials consider a threat to national security, and will focus on older chips and the products that use them, such as medical devices, vehicles, smartphones and weapons, according to the Bloomberg report. Quoting sources familiar with the matter.

The investigation will be conducted under Section 301 of the US Trade Code and will examine unfair trade practices.

According to the report, this investigation could pave the way for more trade restrictions to protect American manufacturing in an increasingly competitive global semiconductor market.

However, Bloomberg reported that any policy decisions based on the results will likely fall to the incoming administration of President-elect Donald Trump.

The report notes that while Biden administration officials discussed the decision for months, a consensus was recently reached to move forward with the investigation.

However, shares of Hong Kong-listed Semiconductor Manufacturing International Corp (HK:) (SMIC) rose 1.4%, while Hua Hong Semiconductor Co., Ltd (Hong Kong:) rose by 1.5%.

Broader Chinese markets also rose, with the index rising 0.7% and gaining 0.6%. The Hong Kong index jumped 1%.

Reuters reported on Tuesday that Beijing will raise its budget deficit to 4% from 3% of GDP in 2025, an all-time high, and will also target 5% GDP growth for the third year in a row.