The US-China trade war between the United States and China two of the world’s largest economies has significantly disrupted global industries. However, no sector has felt the tremors more profoundly than the technology industry. From semiconductors and AI chips to consumer electronics and supply chains, this sector has experienced US-China trade barriers, export controls, tariffs, and a broader shift toward techno-nationalism. Let’s examine the depth of the impact with a focus on key numbers, company responses, and policy shifts.

Recent Highlights: US China Tariff War

• On December 3, 2024 - China imposed a ban on exports of gallium, germanium, antimony, and other critical high-tech materials to the United States, citing their potential military applications
• On April 2, 2025 - President Trump ramped up tariffs on Chinese imports to 145% and temporarily halted new tariffs on goods from other countries for a 90-day period
• On April 4, 2025 – In direct retaliation, China elevated tariffs on U.S. imports to 125%, intensifying the ongoing trade conflict
• On April 10, 2025, the White House announced that China could face up to a 245% tariff on imports to the U.S. due to its retaliatory measures, aligning with President Trump's "America First Trade Policy"

US China Tariff Imports and the Semiconductor Industry: A Strategic Flashpoint in the Trade War

The semiconductor market lies at the core of US China trade tensions. Chips are the foundation of modern computing, AI, defense systems, and consumer electronics making them a matter of national security.

The Semiconductor Industry Association (SIA) expects that China will account for 36% of global semiconductor sector demand in 2022. However, U.S. semiconductor exports to China fell by 27% between 2022 and 2024 as a result of export curbs implemented by the Biden administration. In October 2023, the US Department of Commerce restricted exports of AI chips, including Nvidia's A100 and H100, to Chinese data centers. In retaliation, China prohibited exports of gallium and germanium, two metals required in chip and fiber optic manufacture, leading global prices to rise 36% and 42%, respectively, within two weeks of the announcement. Many analysts view these measures as part of a broader escalation in the ongoing US China trade war timeline.

Additionally, the U.S. CHIPS and Science Act allocated $52.7 billion in subsidies and incentives to boost domestic chip manufacturing. Meanwhile, China's government has allocated more than $150 billion to its own semiconductor self-reliance strategy by 2025, increasing investment in companies such as SMIC and Huawei.

Consumer Electronics: US-China Trade Tariffs and Manufacturing Exodus

The US China trade war has also had a significant impact on the consumer electronics industry, with the United States imposing a 25% US China tariff on over $200 billion worth of Chinese goods, including laptops, smartphones, and computer components.

Moody's reported in 2023 that smartphone production prices in the United States increased by up to 18% owing to tariffs and component shortages. Apple relocated over 10% of iPhone assembly to India and invested $1 billion in Vietnam. Companies such as Dell and HP have also declared plans to relocate up to 30% of their notebook production outside of China, citing US China tariff war concerns and rising wages. The cascading effect of this shift has reshaped global electronics manufacturing, creating ripple effects across Southeast Asia while weakening China’s dominance in this segment.

US China Trade War - Market Decline and Corporate Fallout

Numerous American and Chinese tech firms have reported declining revenues and delayed R&D plans due to restricted access to critical components or markets.

Between 2021 and 2023, Intel's revenue from China, which had previously accounted for more than 25% of overall income, decreased by $3.2 billion (or around 22%). In fiscal 2023, Qualcomm, a US chipmaker that relies largely on Chinese clients, had a 15% year-over-year reduction in revenue from China. SMIC, China's largest chip foundry, lacks technological advancements. As of late 2024, it is still unable to manufacture below 7nm without access to EUV lithography tools, which are still prohibited under Dutch and US export controls.

The broader Philadelphia Semiconductor Index also saw increased volatility during key moments in the US-China trade war, with a 14% dip between Q3 and Q4 of 2023 alone.

US China Tariff War - Techno-Nationalism and Policy Shifts

The US-China trade war has triggered a trend of techno-nationalism, with both countries racing to secure control over strategic technologies. In addition to the CHIPS Act in the U.S., other strategic shifts include:

• Huawei’s pivot to domestically manufactured 5G chips, launching its 2023 flagship phone powered by a chip made entirely in China.
• Nvidia’s creation of China-specific AI chips, like the A800, to comply with U.S. export rules while retaining a foothold in the Chinese market.
• The U.S. Treasury's new investment screening rules (2024), aimed at controlling American investment into sensitive Chinese tech sectors like quantum computing and advanced semiconductors.

U.S. companies are now reassessing future partnerships in light of evolving US China trade deal uncertainties. These movements highlight the long-term decoupling trend, implying that the global tech sector will continue to function along divided supply and innovation chains for years to come.

US China Trade War - A Divided Future for Global Tech

This bifurcation signals a long-term realignment in the global technology industry. Innovation, production, and investment decisions are increasingly being influenced by geopolitics rather than just market forces. The consequences of this decoupling will be far-reaching. As the two tech superpowers continue to build parallel ecosystems, the global supply chain is likely to evolve into dual systems, each with its own standards, regulations, and key players. The divergence in trade volumes is also contributing to a widening US China trade deficit, especially within high-value technology components.

While the immediate effects have included revenue drops and supply shifts, the longer-term implications may involve restricted collaboration in research and innovation, delayed global tech rollouts, and increased costs for consumers worldwide. In conclusion, the US-China trade war has reshaped the global technology industry in fundamental ways. The sector now stands divided by geopolitical boundaries, caught between national interests and market realities. As export restrictions tighten and techno-nationalism gains momentum, companies must navigate an increasingly complex global landscape, where every policy move has the potential to alter the technological future.