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US firms may lose up to $56.3B in sales from tech export controls: think tank


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US firms may lose up to $56.3B in sales from tech export controls: think tank

Export controls on a broader set of emerging and foundational technologies could cost U.S. companies $14.1 billion to $56.3 billion in sales over the next five years and threaten 18,000 to 74,000 jobs, the Information Technology and Innovation Foundation said.

The U.S. Commerce Department's Bureau of Industry and Security, or BIS, is working on applying export controls to an enlarged list of technologies on national security concerns. The BIS is considering defining biotechnology, artificial intelligence, advanced computing, robotics and advanced surveillance, among others, as emerging technologies. What will qualify as foundational technologies is unknown.

The BIS' plan could clip the competitiveness of affected U.S. companies and, in turn, hamper output, exports and employment growth, the science and technology think tank said in a report published May 20.

"Imposing export controls necessarily harms domestic firms in the short run, reducing their sales and thus their ability to reinvest profits in [research and development] that enables them to continue to innovate and to create the high-paying, tech-based jobs associated with cutting-edge technology sectors," the foundation said.

The think tank said that while the U.S. government is right to prevent defense-related technologies from being used by "potential adversaries," the country's competitiveness in emerging technologies should not be put at risk.

"Instead, restrictions should be constructed to target specific military technologies as narrowly as possible while BIS evaluates the potential of coordinated international action, which is necessary for any export control regime to be effective," the foundation said.

The think tank published the report days after the U.S. had blacklisted Chinese telecommunication giant Huawei Technologies Co. Ltd., citing national security and foreign policy threats. The blacklisting led Alphabet Inc.'s Google LLC to suspend some business with Huawei, though the government later issued a temporary license to allow American companies to conditionally continue doing business with Huawei for three months to support existing customers.