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US blacklists 'China's MIT' as tech war enters new phase

Harbin Institute of Technology loses access to American technology and talent

The Harbin Institute of Technology at Shenzhen University City. HIT has had its access to critical engineering software cut off, and a joint education plan with University of Arizona is now in limbo.

HONG KONG/TAIPEI -- The U.S. war on Chinese technology has entered a new phase, with universities in the country added to Washington's blacklist of tech entities.

While Chinese tech giants such as Huawei Technologies, Hikvision and SenseTime have long had restricted access to American technology, the extension of the so-called entity list to educational institutions means that the Chinese equivalent of the Massachusetts Institute of Technology will now take a hit. The entity list specifies companies or organizations that require U.S. government approval before American technology can be sold or transferred to them.

The 100-year-old Harbin Institute of Technology has had its access to critical engineering software cut off, a joint education plan with the University of Arizona is now in limbo, and academic exchange programs with the University of California, Berkeley, are no longer available, the Nikkei Asian Review has learned.

The issue surfaced last week when a screenshot of emails between HIT and Massachusetts-based software developer MathWorks went viral on social media.

In response to a HIT user's complaint about failed access to a software that the university had purchased, MathWorks told the Chinese university that it can no longer supply the product due to a change in U.S. policy. Neither HIT nor MathWorks immediately responded to Nikkei Asian Review's requests for comment, but students from the university confirmed the restriction.

The blocked software, called MATLAB, is used by HIT engineering students in their day-to-day studies and for laboratory work.

Harbin Engineering University, also in the northern Chinese city, was also placed on Washington's entity list in May.

The two universities can no longer import U.S. equipment or software without Washington's approval. Although China has tried to find non-U. S. suppliers and to embrace open source solutions in recent years, experts say not having access to American-made research and development tools will hinder their work.

The political tensions have also cast a shadow over academic exchanges, with one top U.S. university suspending exchanges with the Chinese universities.

"For organizations now on the entity list, it will become more difficult for U.S. academic institutions to consider collaboration," said Paul Triolo, head of geotechnology research at New York-based risk consultancy Eurasia Group. "U.S. academic organizations will have to increasingly weigh the reputational costs of collaborating with Chinese organizations that have been associated with China's military programs or other controversial actions."

The U.S. Department of Commerce said in a statement accompanying its latest entity list published in May that the two Chinese universities and 22 other entities were being punished for "engaging in activities contrary to the national security or foreign policy interests of the United States." It did not say what those interests are, but Beijing sees the move as a fresh attack.

"The move reflects the U.S.'s ingrained cold-war thinking," Chinese Foreign Ministry spokeswoman Hua Chunying told reporters at a briefing on Friday. Hua called the blocked access to American software "political repression" against China, and urged the U.S. to lift the ban.

The dispute is the latest skirmish in a battle between Washington and Beijing on fronts ranging from technology development, to financial markets and media.

The U.S. government added 11 Chinese entities to its blacklist in 2018, and 42 (excluding Huawei and its affiliates) last year, according to the Commerce Department. Thirty-five more were added in January to May of this year.

Chinese universities are playing a key role in Beijing's push for global tech leadership. As well as helping cultivate skilled scientists, engineers, and programmers for domestic companies, they also directly supply advanced technologies.

While largely unknown outside the country, HIT was the first Chinese university to build a chess-playing computer and an arc-welding robot. In 2015, it revealed the structure of proteins in the HIV. It also beat out the Massachusetts Institute of Technology and Stanford University to take the top spot for electrical and electronic engineering, according to the U.S. News & World Report's most recent "Best Global Universities" list.

The question is whether the Chinese upstart can stay on top without access to U.S. software and hardware.

A researcher who previously worked for HIT's School of Astronautics told Nikkei that his laboratory heavily relies on U.S. technology and that finding an alternative will be nearly impossible.

"Most [simulation] software is from the U.S., and no other countries supply such software," said the researcher. Like many from the university, the researcher requested anonymity in order to speak freely. HIT forms the backbone of China's astronautics industry. The university has designed, built and launched its own satellites, and is deeply involved in China's major space missions.

It is hard to say how many laboratories at HIT have had their work disrupted by the U.S. export ban. But interviews with scholars and students from a number of departments indicate that the effects are widespread.

One civil engineering student said that in his field alone, at least two important tools used for computer-aided designs and engineering simulations are provided by U.S. software companies and that losing access to them could "isolate [students] from what's going on out there, and slow down research and scientific development."

The university's ability to create advanced medical equipment, a priority industry under Beijing's "Made in China 2025" strategy, is also at risk.

A graduate majoring in biomedical engineering at HIT told Nikkei that his laboratory relies on U.S. high-end chipsets to process medical images and that high-quality alternatives are hard to come by.

"Chinese companies such as Huawei have also developed artificial intelligence chips, but not all of its products are of comparable quality, or are the global standard, as the chips designed by Nvidia of the U.S. are," he said, adding, "It is challenging for us to build cutting-edge solutions upon domestic hardware."

Students and scholars from the blacklisted universities also face growing isolation from the international scientific community. In theory, the entity list does not restrict the flow of talent. But in practice, fewer American universities feel comfortable partnering with people affiliated with universities subject to U.S. government sanctions.

"All of our academic exchange programs [with HIT and HUE] are already on hold," said the University of California, Berkeley, in an emailed statement to Nikkei. UC Berkeley did not say which fields the universities had collaborated on.

The University of Arizona, which has a joint college with HIT that teaches students how to leverage information technology such as big data to empower business operations, told Nikkei that it is "ironing out the nature of our relationship with HIT and other entities."

Other top U.S. academic institutions that have exchange programs and partnerships with HIT include the University of Illinois Urbana-Champaign and Carnegie Mellon University, according to the schools' websites. Neither responded to a request for comment.

Kevin Wolf, an international trade lawyer at Akin Gump, said the export control rules do not apply to technological expertise that is already published or considered as fundamental research, but academics exchanges often go beyond that.

As a result, "such exchanges will become more difficult and will often require licenses to conduct," he said.

Timothy Heath, a senior international defense researcher at Rand Corp., a U.S. think tank, agrees: "The addition on the entity list will cast a chill on U.S. efforts to partner with Chinese companies and schools."

Chinese scientists already face headwinds getting to the U.S. for study. The Trump administration is reportedly considering expelling Chinese graduate students and researchers who have direct connections to universities affiliated with the People's Liberation Army. At least 3,000 students are expected to be affected, according to industry estimates.

At HIT, Chinese students say opportunities to study in the U.S. have become increasingly scarce.

The graduate who studied biomedical engineering said that a doctoral student in his department had been scheduled to attend an exchange program in the U.S. last year, but failed to obtain a visa after six months of back and forth with the U.S. Embassy.

"This year, no postgraduate students received offers [for the exchange program] from American universities because those universities were under pressure from the U.S. government," the graduate said. "Although we can attend exchange programs in Europe or elsewhere, almost all the students prefer to study in the U.S., as universities there are really the cream of the crop."

"American scholars are also reluctant to come here," the student said, citing Washington's increasingly tightened scrutiny as the key reason.

The student, as well as many others Nikkei spoke with, said the U.S. entity list is unlikely to end the high-tech development of HIT and other Chinese universities, but it will certainly slow down their work.

"It is definitely going to be more and more difficult [for Chinese universities to advance their innovation]. The blacklist is just the first step," he said.

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