Trump’s Twin Blows to China: Tech Restrictions and Student Visa Crackdown Threaten Trade Truce

Beijing, May 30, 2025 - The fragile trade war truce between the United States and China faces collapse following two major moves by the Trump administration. On Wednesday, new export controls were imposed on software used to design semiconductors, effectively cutting off Chinese tech firms from critical US technology. Simultaneously, US Secretary of State Marco Rubio announced plans to aggressively revoke visas for Chinese students, particularly those in critical fields or with perceived ties to the Chinese Communist Party.

These actions, targeting China's technological ambitions and its citizens studying abroad, have sparked outrage in Beijing and raised doubts about the future of US-China trade talks, with a 90-day truce period rapidly approaching its end.

Semiconductor Restrictions Escalate Tech Tensions

The US decision to restrict exports of chip-designing software marks a significant escalation in the ongoing US-China technology rivalry. Semiconductors, essential for powering smartphones, computers, and vehicles, are at the heart of this conflict. The Biden administration previously blocked China’s access to US-made chips, and recent warnings targeted the use of AI chips from Chinese tech giant Huawei. China has invested heavily—over $150 billion in the past decade—to bolster its domestic semiconductor industry, yet it remains reliant on foreign technology.

The new restrictions, confirmed by industry sources, are seen as a deliberate move to hinder China's technological self-sufficiency. A Chinese Embassy spokesperson accused the US of abusing export controls to suppress China's development, highlighting Beijing's frustration with these measures.

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Visa Revocations Disrupt Chinese Students and Families

The second blow came with Rubio’s announcement to revoke visas for Chinese students, particularly those studying in fields like engineering and technology or suspected of links to the Chinese Communist Party. In 2024, over 270,000 Chinese students were enrolled in US institutions, many from middle-class families who invested heavily in their education. The policy threatens to deport students mid-study, causing widespread anxiety.

For instance, a statistics student at the University of Michigan expressed fears of returning to China with only a high school diploma. China’s foreign ministry condemned the move as unjust, arguing that the vague criteria for Communist Party affiliations could unfairly target students. Recent trends show a decline in Chinese student enrollment in the US, down 15% since 2019, partly due to concerns over safety and immigration challenges.

Did You Know?
China’s semiconductor industry accounts for 16% of global production capacity, but it relies on foreign software and equipment for over 70% of its advanced chip manufacturing.

Long-Term Implications for US-China Relations

These twin policies risk unraveling the temporary US-China trade truce, which had sparked optimism with factories resuming operations and shipping containers moving again. The truce, set to expire in less than 90 days, faces uncertainty as both nations struggle to negotiate a long-term agreement. While a federal court blocked Trump’s proposed 30% tariffs on Chinese goods, the administration’s immediate appeal keeps the trade war’s future in limbo.

Paradoxically, the visa crackdown may benefit China in the long run by encouraging top talent to stay home or pursue education elsewhere, such as in Singapore or the UK, where Chinese student applications have risen by 20% in 2025. This could accelerate China’s technological advancements, countering US efforts to maintain a competitive edge.