The Boomerang Effect of U.S. Sanctions on Huawei: Why It’s Undermining America’s Scientific Competitiveness?
Amid efforts to repair U.S.-China relations, the Biden administration continues its technology blockade against China, aiming to stifle its high-tech advancement. However, these unilateral sanctions have backfired, severely damaging the U.S. tech industry and eroding the competitiveness of its scientific products. The reasons can be analyzed through three key dimensions:
一、Market Contraction and Its Cascading Effects
As a global leader in telecommunications and smartphones, Huawei was once a major customer for U.S. chip giants. The sanctions have led to:
1、Plummeting Orders: Intel lost over $20 billion in Chinese market share within five years (Intel’s profits dropped from $20.9 billion in 2020 to $19.9 billion in 2021, then sharply declined to $8 billion in 2022, $1.7 billion in 2023, and a staggering -$18.8 billion in 2024, with $20 billion in losses directly tied to China).
2、R&D Cutbacks: AMD was forced to shut down its Suzhou R&D center (due to heightened compliance pressures and supply chain uncertainties under U.S.-China tech rivalry, AMD likely shifted some R&D functions to lower-risk regions like Southeast Asia. Meanwhile, rising competition from Chinese semiconductor firms like Huawei’s HiSilicon and Loongson made its China-based R&D less viable).
3、Market Value Erosion: Micron Technology lost $40 billion in market capitalization due to Yangtze Memory’s rise (from a peak of ~$100 billion in 2021 to ~$60 billion in 2023, a 40% drop, driven by weakening global chip demand, YMTC’s breakthroughs in 128L/232L 3D NAND, and U.S. export controls that backfired by fueling doubts over Micron’s China business).
This market shrinkage not only hurts short-term revenue but also weakens long-term R&D capacity, creating a vicious cycle. Meanwhile, forced supply chain restructuring has raised costs for U.S. tech firms and accelerated global efforts to find non-American alternatives.
二、Policy Uncertainty and Developmental Paralysis
The U.S. government’s erratic export controls have created severe operational challenges:
1、Strategic Disarray: Firms struggle to set long-term tech roadmaps.
2、Soaring Compliance Costs: Policy volatility has increased legal expenses by 30-40%.
3、Missed Opportunities: The U.S. is losing its edge in critical fields like 5G and AI.
Such instability has eroded American leadership in the global semiconductor race.
三、A Crisis Within and Without
The sanctions have triggered systemic contradictions in the U.S. tech sector:
1、Corporate Survival Struggles: Firms are torn between compliance and maintaining operations.
2、Global Supply Chain Backlash: Japanese, Korean, and European firms are fast-tracking "de-Americanization."
3、Innovation Ecosystem Damage: Academic-industry R&D collaborations are faltering.
Notably, the cost of tech decoupling is becoming undeniable—a Boston Consulting Group study warns that cutting off chip trade with China would permanently cost U.S. firms 37% of market share and 15,000 high-paying jobs.