This lopsided coverage profile has led to criticism that the EPF has morphed into an investment and savings vehicle for the rich. Senior pension fund executives told CNA that this impression is tough to refute. The prime minister has also asked EPF to invest more domestically to aid the economy.Continue Reading
Republicans and Democrats are again playing a game of chicken over the US debt ceiling – with the nation’s financial stability at stake.
Treasury Secretary Janet Yellen recently said that June 1, 2023, is a “hard deadline” for raising the debt limit, currently set at US$31.38 trillion, to avoid an unprecedented default. The government hit the ceiling back in January and has been using “extraordinary measures” since then to keep paying its bills.
Last-minute negotiations between the White House and Republicans have been mostly fruitless as conservatives in the House push for big spending cuts and policy changes, while President Joe Biden has insisted on lifting the ceiling with no strings attached. They are expected to continue to meet in the coming days.
Economist Steven Pressman explains what the debt ceiling is and why we have it – and why it may be time to abolish it.
Like the rest of us, governments must borrow when they spend more money than they receive. They do so by issuing bonds, which are IOUs that promise to repay the money in the future and make regular interest payments. Government debt is the total sum of all this borrowed money.
The debt ceiling, which Congress established a century ago, is the maximum amount the government can borrow. It’s a limit on the national debt.
The US government debt of $31.38 trillion is about 22% more than the value of all goods and services that will be produced in the US economy this year.
Around one-quarter of this money the government actually owes itself. The Social Security Administration has accumulated a surplus and invests the extra money, currently $2.8 trillion, in government bonds. And the Federal Reserve holds $5.5 trillion in US Treasurys.
The rest is public debt. As of October 2022, foreign countries, companies and individuals owned $7.2 trillion of US government debt. Japan and China are the largest holders, with around $1 trillion each. The rest is owed to US citizens and businesses, as well as state and local governments.
Before 1917, Congress would authorize the government to borrow a fixed sum of money for a specified term. When loans were repaid, the government could not borrow again without asking Congress for approval.
The Second Liberty Bond Act of 1917, which created the debt ceiling, changed this. It allowed a continual rollover of debt without congressional approval.
Congress enacted this measure to let then-President Woodrow Wilson spend the money he deemed necessary to fight World War I without waiting for often-absent lawmakers to act. Congress, however, did not want to write the president a blank check, so it limited borrowing to $11.5 billion and required legislation for any increase.
The debt ceiling has been increased dozens of times since then and suspended on several occasions. The last change occurred in December 2021, when it was raised to $31.38 trillion.
Whenever the US nears its debt limit, the Treasury secretary can use “extraordinary measures” to conserve cash, which she indicated began on January 19. One such measure is temporarily not funding retirement programs for government employees. The expectation will be that once the ceiling is raised, the government would make up the difference. But this will buy only a small amount of time.
If the debt ceiling isn’t raised before the Treasury Department exhausts its options, decisions will have to be made about who gets paid with daily tax revenues. Further borrowing will not be possible. Government employees or contractors may not be paid in full. Loans to small businesses or college students may stop.
When the government can’t pay all its bills, it is technically in default. Policymakers, economists and Wall Street are concerned about a calamitous financial and economic crisis. Many fear that a government default would have dire economic consequences – soaring interest rates, financial markets in panic and maybe an economic depression.
Under normal circumstances, once markets start panicking, Congress and the president usually act. This is what happened in 2013 when Republicans sought to use the debt ceiling to defund the Affordable Care Act.
But we no longer live in normal political times. The major political parties are more polarized than ever, and the concessions McCarthy gave right-wing Republicans may make it impossible to get a deal on the debt ceiling.
One possible solution is a legal loophole allowing the US Treasury to mint platinum coins of any denomination. If the US Treasury were to mint a $1 trillion coin and deposit it into its bank account at the Federal Reserve, the money could be used to pay for government programs or repay government bondholders.
This could even be justified by appealing to Section 4 of the 14th Amendment to the US Constitution: “The validity of the public debt of the United States … shall not be questioned.”
Few countries even have a debt ceiling. Other governments operate effectively without it. America could too. A debt ceiling is dysfunctional and periodically puts the US economy in jeopardy because of political grandstanding.
The best solution would be to scrap the debt ceiling altogether. Congress already approved the spending and the tax laws that require more debt. Why should it also have to approve the additional borrowing?
It should be remembered that the original debt ceiling was put in place because Congress couldn’t meet quickly and approve needed spending to fight a war. In 1917 cross-country travel was by rail, requiring days to get to Washington. This made some sense then. Today, when Congress can vote online from home, this is no longer the case.
Steven Pressman is Part-Time Professor of Economics, The New School
This article is republished from The Conversation under a Creative Commons license. Read the original article.
Europe is starting to reverse the decline of its once-strong semiconductor industry, a potentially important turn in the escalating tech war pitting the US and its allies against China.
Despite having some of the world’s best technology – and despite the large size of the European economy – Europe’s chip industry has dwindled to just a third of the silicon wafer processing capacity of Japan and less than half of the US.
Both the private sector and EU bureaucracy are now working to reverse the decline, though the hyperbole of some politicians is obscuring the situation. For example, on May 16, EU Commissioner for Internal Market Thierry Breton delivered the keynote address at the IMEC Technology Forum in Antwerp. Among other things, he said:
“We are refusing any attempt of geographical segmentation where Europe would produce mature nodes, while Asia and US would produce advanced nodes.”
“Europe cannot and will not be considered as a mere observer in any ‘underground technological battle’ between blocks.”
“Europe will not be subject to the choices of others. This is why I want a Europe that knows how to lead on semiconductors.”
Apart from rallying the corporate troops, Breton’s remarks are puzzling. For one, no one is conspiring to keep the European semiconductor industry down. On the contrary, Europe is cooperating with US sanctions to confine China to mature chip technology.
Nor is there any known “underground technological battle” between “blocks.” There is a well-publicized and highly-politicized conflict between the US and its allies on the one side and China on the other – a Western bloc and an Eastern bloc in a new semiconductor cold war.
Furthermore, all nations’ semiconductor industries are and will remain subject to the choices of others. And Europe, as home to ASML, Infineon, ST Micro and other first-rate semiconductor device and equipment makers, already knows what it takes to lead the industry.
Practically speaking, the problem in Europe is the same as the problem in the US, only arguably worse: limited production capacity and high dependence on Taiwan, specifically TSMC.
This situation is the result of investment decisions made over the past two decades, not a secret conspiracy. Breton is, of course, aware of this, having been a prominent business executive and French minister of economy, finance and industry.
In 2022, European spending on semiconductor production equipment nearly doubled, but still accounted for only 5.8% of the global total, according to industry association SEMI.
The figure for the US was 9.7%, after an increase of almost 40%. The figures for China, Taiwan and South Korea were 26.3%, 24.9% and 20.0%.
At the end of 2021, Europe’s share of worldwide integrated circuit wafer capacity was only 5%, according to Knometa Research. That was dwarfed by the Americas (11%), Japan (15%), China (16%), Taiwan (21%) and South Korea (23%).
The European Chips Act was enacted to upend that trend. Officially proposed in February 2022, it was approved by the European Parliament in April 2023.
With a 43 billion euro ($46.4 billion) package of public and private investments, it aims to raise Europe’s share of the global semiconductor market to 20% by 2030, bringing the industry back to its 2000 position. Estimates vary but it is now at no greater than 10% of the world market.
The Act also aims to diversify the European semiconductor industry away from its concentration in automotive and industrial-use ICs by developing expertise in chips used in artificial intelligence, 6G mobile telecom, the Internet of Things, quantum computing and other emerging areas, with investments in everything from “innovation” and design to fabrication and packaging.
To ramp up mass production and introduce advanced process technology, the EU is relying on new investments by Infineon and other European companies, joint ventures with foreign companies such as the one announced by STMicroelectronics and GlobalFoundries last year, and direct investment in production facilities by Intel and TSMC.
According to commissioner Breton, “This will allow us to rebalance and secure our supply chains, reducing our collective dependence on Asia.”
That should be possible to a degree, but regaining 20% of the global semiconductor market is likely a stretch. The US CHIPS Act offers more money ($52.7 billion); TSMC, Samsung Electronics and Intel are investing heavily in their home markets; Japan is pursuing a strategy similar to Europe’s; and China appears to be spending an amount of money on chip development that Europe won’t or can’t match.
Last December, it was reported that China was planning to provide its semiconductor industry with more than $140 billion in corporate subsidies and tax credits. In January, however, it was reported that this approach had been abandoned.
The Chinese government and Chinese semiconductor companies are now said to be focused on mature process nodes rather than accelerated miniaturization in order to develop comprehensive expertise step-by-step.
Even so, China’s progress is still impressive. Guangdong province alone has some 40 semiconductor-related projects valued at more than $70 billion either underway or in the planning stage. Investments are also reportedly being ramped up in Shanghai, Suzhou, Beijing and elsewhere.
China’s problem is the opposite of Europe’s: its semiconductor production capacity is already quite substantial – more than 15% of the worldwide total, including foreign-owned facilities – but it must invest heavily to dodge and circumvent US sanctions, which are migrating from leading-edge to mature process nodes.
In particular, China must protect its auto industry from sanctions. Here, as is already the case with ASML and the ban on exporting EUV lithography tools to China, Europe could become an important factor.
Europe’s three top semiconductor makers – Infineon, STMicroelectronics and NXP – all have significant business interests in China. They are also the world’s top three makers of automotive ICs while China is both the world’s largest auto market and biggest producer of electric vehicles.
Breton said, “I am eager to work with the US, Canada, India, Japan, South Korea, Singapore, and, of course, Taiwan.”
That is, everywhere but China, which he refers to as a systemic rival. In Europe as in the US, the semiconductor industry tends to see China as a great market opportunity while politicians increasingly regard it as a strategic risk.
As long as politicians limit themselves to tough rhetoric rather than punitive action, European automotive IC makers should have a bright future doing business in China. But if they decide to impose sanctions on China’s auto industry, those same companies – and European automakers – will pay a high price.
Follow this writer on Twitter: @ScottFo83517667
“I think it’s still a region that not many people think of straight away. Many Singapore companies, naturally, will still think of countries in the nearby regions, and rightfully so because these are familiar regions and these are also growth regions, especially South Asia,” said Mr Clarence Hoe, executive director for Americas and Europe at EnterpriseSG.
“But this is where Enterprise Singapore comes in. We really look at finding the new areas which are growing, identify them and share them with our companies. And this helps to provide new markets, not just as a growth opportunity, but also as a market for diversification.”
Kazakhstan, one of the largest economies in Central Asia, is Singapore’s largest trading partner in the region, with more than 30 Singapore companies in the country. There are also over 20 firms operating in neighbouring Uzbekistan.
EnterpriseSG said it is organising seminars and trade missions for Singapore firms to connect and collaborate with partners in Central Asia, as part of efforts to help more local firms expand and enhance their supply chain resilience.
Some businesses that have expanded into Central Asia told CNA that their efforts are paying off.
Among them is Singapore-listed food manufacturing and distribution company Food Empire, which saw an opportunity nearly 30 years ago.
Today, the company’s coffee products can be found in stores and supermarkets across Kazakhstan.
“Our business has been growing year upon year,” said Mr Anil Bhuwania, business head of Central Asia at Food Empire.
“Over the last four years, in terms of volume, our market share has grown from 67 per cent to 73 per cent (for) coffee mixes.”
The company is now looking to add tea products into the mix, especially tea with milk.
However, logistics and transportation remain a challenge.
“We need to find alternative routes, either via China or sometimes via Georgia, and see how the goods can be transported into Kazakhstan because it’s a landlocked country,” said Mr Bhuwania.
US chip maker Micron Technology has become the first Western firm sanctioned by China after G7 countries vowed to de-risk from the world’s manufacturing hub.
China’s key national infrastructure operators are now forbidden to purchase products from Micron because the company poses network security risk, said the Cybersecurity Review Office, a unit of the Cyberspace Administration of China.
Mao Ning, a spokesperson of the Chinese Foreign Ministry, said Monday that the investigation of Micron’s products is necessary as it is aimed at preventing China’s telecom infrastructure from facing cybersecurity risks.
The US Commerce Department said China’s accusations against Micron have no basis in fact. It said it will engage directly with China to resolve restrictions on Micron chip deliveries.
“We also will engage with key allies and partners to ensure we are closely coordinated to address distortions of the memory chip market caused by China’s actions,” the department said. “This action, along with recent raids and targeting of other American firms, is inconsistent with the People’s Republic of China (PRC)’s assertions that it is opening its markets and is committed to a transparent regulatory framework.”
The US had asked South Korea to urge its chipmakers not to fill any market gap in China if Micron products were banned in the Chinese markets, according to a Financial Times report published April 24.
Jang Young-jin, South Korea’s vice minister of trade, said Monday that Samsung and SK Hynix will make a judgment on whether they should do as the US requested.
Micron said it is evaluating the conclusion made by the Cyberspace Administration and assessing its next steps.
An article titled “Micron has done all the bad things! Now it is finally sanctioned” was widely circulated on the Internet in China on Monday, explaining the logic behind Beijing’s curbs.
“In January 2022, when the US government pushed forward its plan to de-couple from China, Micron said it would stop cooperating with China, sack its staff and close its Shanghai-based DRAM design center,” the writer says. “It also provided skilled worker visas to more than 40 senior technicians and migrated its businesses from China to India and the US.”
The writer continues, “In the China-US chip war, Micron has always been actively playing the role of a vanguard of the US. The company makes money in the Chinese market while replying to the United States’ power to suppress Chinese chip firms. It has done all the bad things!”
He concludes, “What do we only sanction Micron but not Samsung and SK Hynix? They all make money in China but Micron does not increase its investment in the country while Samsung and SK Hynix keep re-investing.”
Media reports said last month that US President Joe Biden was set to sign an executive order that would restrict US companies and private equity and venture capital funds from investing in China’s microchips, artificial intelligence, quantum computing, biotechnology and clean energy projects and firms.
Biden had planned to announce these investment curbs before the G7 Summit, which was held in Hiroshima between last Friday and Sunday, but he has not unveiled them so far.
G7 leaders said in a joint statement on Saturday that they have a common interest in preventing a narrow set of technological advances from being used by some countries to enhance their military and intelligence capabilities to undermine international peace and security.
“A growing China that plays by international rules would be of global interest. We are not decoupling or turning inward,” they said. “At the same time, we recognize that economic resilience requires de-risking and diversifying.”
“We will continue to ensure that the clearly defined, narrow set of sensitive technologies that are crucial for national security or could threaten international peace and security are appropriately controlled, without unduly impacting broader trade in technology,” said G7 leaders. “We will enhance resilient supply chains through partnerships around the world, especially for critical goods such as critical minerals, semiconductors and batteries.”
This statement also set off the Chinese punditocracy. “G7 has become an important tool for the US to contain and suppress China,” a Hebei-based writer says in an article. Washington “is now promoting deglobalization by using subsidies and coercion to attract semiconductor firms to set up factories in the US.”
He adds, “Now the US gets what it wants as China is saying ‘no’ to US memory chip makers. Micron tried to expand in China and benefit from the US sanctions against Chinese chip firms. But it has shot itself in the foot.”
Last year, Micron’s revenue from China amounted to $3.3 billion, about 11% of the company’s total revenue. The figure more than tripled from $5.3 billion in 2016 to $17.4 billion in 2018 but it started to decline after Micron had legal disputes with Chinese firms.
As early as March 31, the Cyberspace Admnistration had said it was looking into Micron’s products sold in China but it was not until Sunday evening that it announced the Micron ban.
An unnamed analyst was quoted by the National Business Daily as having said on Monday that Chinese memory chip makers, including GigaDevice, Yangtze Memory Technologies Corp (YMTC), ChangXin Memory Technologies (CXMT), Dongxin Co. Ltd and Ingenue Semiconductor, will benefit as they can grab Micron’s market share in China.
He said that during the transition, China will not face a memory chip shortage as there is enough inventory in the markets.
YMTC, the main Chinese competitor to Micron, is developing its own supply chain by using Chinese-only equipment, the South China Morning Post reported on April 23. The company has placed orders with domestic tool suppliers, including Beijing-based Naura Technology, after receiving new funding from its state-backed investors.
However, Liu Pei-chen, a researcher at the Taiwan Institute of Economic Research, warned that China may face a memory chip shortage if suppliers in South Korea, Japan and Taiwan limit their exports to the country upon the US’s request.
Liu said China still relies heavily on the import of foreign memory chips as YMTC and CXMT have limited production capacities. She said the US may have a say in whether suppliers in South Korea, Japan and Taiwan should take up Micron’s market share in China.
Read: Micron probe by China seen as chip war retaliation
Follow Jeff Pao on Twitter at @jeffpao3
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In December 2022, Japan, Italy and the United Kingdom signed an agreement to partner in the development of a sixth-generation stealth fighter aircraft.
The goal of the Global Combat Air Program (GCAP) is to produce aircraft ready for export and deployment by 2035. This represents a new frontier for Japanese weaponry co-development and is a prime opportunity to enhance regional security cooperation.
The United Kingdom’s and Italy’s motivation to partner with Japan in the GCAP is to fill gaps in development funding. The number of aircraft that will be produced and their technological development has improved through Japanese participation in the GCAP.
Initially, Japan was seeking “Japan-led development” of its Mitsubishi F-X fighter jet project, with a view to international cooperation in its Medium Term Defense Force Development Plan, assuming joint development with the United States or the United Kingdom.
But as the United States was reluctant to support “Japan-led development” and technology transfer, Japan chose the United Kingdom as a joint development partner for its next-generation fighter aircraft.
Many contentious issues are expected to arise in the GCAP program, including negotiations over development initiatives, operations, specifications, the sharing of development costs, technology transfer, scheduling and production sharing.
The desired outcome of the GCAP is to contribute to regional security by establishing the weapon system as the core of NATO and AUKUS regional cooperation in responding to the war in Ukraine and military tension with China.
Operational requirements, technology and industry, development cost sharing and alliance politics are all essential in international joint development. But the negotiations in the GCAP seem to be driven mainly by alliance politics.
It is essential to understand the United Kingdom and Italy as partners in the context of Japan’s “Japan-led” development policies. During the 20 years of United States-Japan Mitsubishi F-2 fighter jet operations, Japan has been able to implement “Japan-led” development in operational requirements, upgrades and system integration. These are the three independent operations that should be continued in the GCAP.
These and other issues will likely be the subject of negotiations among the three countries. Japan has only co-developed defense technology projects with the United States in the past. Negotiation is essential for the success of the GCAP, which will be Japan’s first co-development with a country other than the United States.
The key to the success of the GCAP is to expand the number of aircraft produced before achieving economies of scale and learning curve effects through exports to the European and Asia Pacific markets, where many states are scheduled to begin their procurement of fifth- or sixth-generation fighter aircraft.
The key is to develop a cheap and downgraded version of the GCAP, not only for target countries that envisage modern air warfare in terms of stealth but also for those that do not. In the former case, the French-German-Spanish Future Combat Air System will be a contender, while in the latter, the South Korean-Indonesian KF-21 will be the frontrunner.
In the context of the AUKUS framework, it will be essential to determine what performance Australia requires of its next generation of fighter aircraft. Within the hub-and-spoke alliance network centered in the United States, it is necessary to promote regional cooperation among the United Kingdom, Japan and Australia.
The United Kingdom, Japan and Italy need to offer offset deals where Australia and other fourth countries can participate in the development and production of GCAPs and import non-fighter weapons, agricultural products and resources when they consider purchasing GCAPs.
Japan’s promotion of GCAP exports and offset deals requires a relaxation of its outdated Three Principles on the Transfer of Defense Equipment and Technology. Notably, the prohibition of transfers that “violate obligations under UN Security Council resolutions” needs to be reviewed urgently, as the UN Security Council has not been functioning effectively since the outbreak of the war in Ukraine.
Japan must shift its strategic outlook and promote a mission-oriented defense policy. By introducing mission engineering methods into GCAP development, which the United States and United Kingdom are leading, Japan can promote GCAP development smoothly and enhance regional security cooperation, including weapon systems, with AUKUS countries including Australia.
Takeshi Sakade is Professor in the Graduate School of Economics at Kyoto University.
This article was originally published by East Asia Forum and is republished under a Creative Commons license.
As China lifts Covid-19 restrictions and returns to normalcy, prospects for private business in the post-Covid economic recovery remain uncertain.
Despite former Vice Premier Liu He’s reiteration of the central government’s adherence to market principles at the World Economic Forum in January 2023, there are mixed messages about the Party’s stance towards the private tech sector.
The detention of Bao Fan, chairman and CEO of investment bank China Renaissance Holdings, in February sent shockwaves through international markets and among Chinese tech entrepreneurs. Bao was widely regarded as the country’s top dealmaker, whose company presided over several high-profile domestic tech deals.
On the other hand, Alibaba’s Jack Ma made a surprise reappearance in China in March, after traveling abroad for over a year. In a seemingly friendly gesture to the private sector, the Cyberspace Administration of China announced a campaign to crack down on false publicly circulated information which damages the reputation of private enterprises and entrepreneurs. But all of this does not suffice in restoring confidence in investors and businesses about a rollback of regulatory scrutiny of private tech companies.
To some, Bao’s detention indicates a continuation of Beijing’s heavy-handed approach to the country’s rising entrepreneurs that began with scuttling an initial public offering (IPO) for Ant Group, the e-payments platform founded by Jack Ma, in late 2020. This continued with tightened regulation over data security and anti-monopoly practices involving tech companies.
The Party’s stance and policy towards the tech sector — or more precisely, technology platforms and their partners — should be read in light of the multiple, often competing, challenges that the Party faces in governing modern China.
Chinese big tech and innovative entrepreneurs have contributed significantly to China’s transformation into a digital economy. At the same time, their rapid growth in size and wealth, as well as their evolving business models, have generated new challenges and instabilities.
Fintech regulation is one of these contradictions. Despite the merits of financial technology, excessive microlending without adequate security could create a financial bubble, posing systemic risk to the national financial system. Fintech companies like Ant have been forced to restructure and made subject to similar regulatory rules that govern other lending institutions.
Another area of contest is in the competition for talent across various fields related to technology development. The 14th Five-year Plan (2021–2025) spelled out ambitious objectives to turn China into a manufacturing powerhouse and a leader in emerging industries.
Competitive remuneration packages and unparalleled career prospects offered by leading platform companies, as well as the perceived invulnerability of the industry, had drawn many bright, young minds into technology-related business fields. This has changed since the government’s policy shift in 2020.
China now needs people to contribute to scientific and technological self-sufficiency in areas such as semiconductor development, robotics and climate change. The state’s clampdown on the business tech sector is thought to have had the effect of pushing people and resources into other areas — such as materials science, industrial machinery and biotechnology — deemed important to China’s overall technological capacity.
The Party’s tough treatment of some tech entrepreneurs could also have been connected to power struggles within the Party itself. Some key investors behind Ant Group’s IPO were known to be linked to top officials and elites with strong ties to former leader Jiang Zemin.
The tech sector may have become the site of a contest for political power. It is unclear with whom Bao is associated inside political circles, but he may have been caught up in a broader political struggle.
Party leaders will certainly continue to rely on China’s tech giants and their innovation to drive the economy. But ensuring that data is managed and used to the benefit of the Party as well as the public, not just private actors, remains a key logic in the Chinese Communist Party’s governance.
The announcement at the “Two Sessions” of the establishment of a National Data Bureau is Beijing’s latest step to exploit the country’s massive data trove. This will allow institutionalization of the management and control of data, while also facilitating circulation of both public and private data resources to promote economic and social development.
Setting up the new National Data Bureau under the National Development and Reform Commission will give focus to implementing policies that help drive digital and cutting-edge industries. The bureau could potentially become a driver of “Digital China“, after years of slow development because of the pandemic and regulatory scrutiny.
Given the Party’s overriding priorities of rebuilding a strong domestic economy and maintaining robust supply chains against external threats, it is unlikely to embark on an extensive campaign like it did in 2020 and 2021 to rein in technology platforms. That would undermine an important engine of growth and investor confidence, adding pressures to government finances.
One can still expect uncertainties over how the Party treats individual private businesses. This is especially so when China’s political leaders deem it necessary to prioritize certain objectives, such as political control and maintaining social stability over other priorities including economic recovery and growth.
Yvette To is a Postdoctoral Fellow in the Department of Public and International Affairs at the City University of Hong Kong.
This article was originally published by East Asia Forum and is republished under a Creative Commons license.
ReutersChina says products made by US memory chip giant Micron Technology are a national security risk.
The country’s cyberspace regulator announced on Sunday that America’s biggest maker of memory chips poses “serious network security risks”.
It means the firm’s products will be banned from key infrastructure projects in the world’s second largest economy.
It is China’s first major move against a US chip maker, as tensions increase between Beijing and Washington.
“The review found that Micron’s products have serious network security risks, which pose significant security risks to China’s critical information infrastructure supply chain, affecting China’s national security,” the Cyberspace Administration of China (CAC) said in a statement.
The CAC did not give details of risks it said it had found or in which Micron products it had found them.
A Micron spokesperson confirmed to the BBC that the company had “received the CAC’s notice following its review of Micron products sold in China”.
“We are evaluating the conclusion and assessing our next steps. We look forward to continuing to engage in discussions with Chinese authorities,” they added.
In response, the US said it would work with allies to address what it called “distortions of the memory chip market caused by China’s actions”.
“We firmly oppose restrictions that have no basis in fact,” US Commerce Department a spokesperson said.
“This action, along with recent raids and targeting of other American firms, is inconsistent with [China’s] assertions that it is opening its markets and committed to a transparent regulatory framework,” it added.
The CAC’s announcement came a day after a G7 leaders meeting in Japan issued a statement criticising China’s human rights record, economic policies and increased military presence in the East and South China Seas.
On Sunday, US President Joe Biden said G7 nations were looking to “de-risk and diversify our relationship with China.”
“That means taking steps to diversify our supply chains,” he added.
Micron chief executive Sanjay Mehrotra attended the summit in Hiroshima as part of a group of business leaders.
Last week, the company said it would invest around 500bn yen ($3.6bn; £2.9bn) to develop technology in Japan.
Demand grows despite prices
Rice exports topped 2.79 million tonnes from January to April with the volume for the entire year forecast to exceed 8 million tonnes, the government said.
Prime Minister Prayut Chan-o-cha was upbeat about the figure, valued at US$1.5 billion (51.2 billion baht), up 23% from the same period last year, said government spokesman Anucha Burapachaisri.
The prime minister has instructed state agencies to work proactively to improve rice exports further and increase crop production while pushing to keep rice prices high in overseas markets, Mr Anucha said.
He added exports of Thai rice are expected to keep rising on the back of growing demand in many countries.
Currently, Thailand is the world’s second-largest rice exporter after India.
In April, the hike in rice prices was attributed to the stable baht which has kept the commodity competitive in foreign markets.
As a result, the prices of most types of rice have risen beyond the government’s price guarantee.
The Agriculture and Cooperatives Ministry has now predicted rice exports will surpass the yearly target.
The Department of Internal Trade (DIT) forecasts exports will reach 8 million tonnes, up from 7.69 million tonnes in 2022.
As of May 10, rice exports stood at 3.05 million tonnes, according to Mr Anucha, adding orders for Thai rice from overseas keep on climbing.
Major markets for Thai rice include Iraq, Indonesia, the US, South Africa, Senegal, Bangladesh, China, Japan, Cameroon and Mozambique. Thailand mostly exports white rice the most, followed by jasmine rice.
Mr Anucha said the prime minister thanked state agencies and the private sector for their efforts in marketing and developing the quality of rice for export to meet demand. However, Gen Prayut has cautioned against fraudulent exports, which could damage the reputation of Thai rice internationally.
Udom Srisomsong, deputy director-general of the DIT, said global demand for Thai rice remains strong, which has sustained prices and made them competitive.
The high export prices have offset the need for the government to step in and use its price guarantee measure to assist farmers.
The Thai Rice Exporters Association, meanwhile, said it fails to see any clarity in measures dealing with crop prices from the Move Forward Party or Pheu Thai, the two main parties that will form the new government. They are thrashing out a memorandum of understanding covering key policy areas as part of the deal.
Charoen Laothamthat, the association president, said a change of government should not stall or bring abrupt changes to policies that hinder the development of key crops.
Companies fear Thailand may be losing its competitiveness in exporting rice to Vietnam.
