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Chip war: Japan and Netherlands expected to join US in ban on tech exports to China

Source image: https://www.theguardian.com/technology/2023/feb/01/chip-war-japan-netherlands-us-tech-export-ban-china-microchips

A Washington official has made the most direct comments by a US authority to date acknowledging the existence of a deal with Japan and the Netherlands for those countries to impose new restrictions on exports of chipmaking tools to China.

“We can’t talk about the deal right now,” said Don Graves, deputy commerce department secretary, on the sidelines of an event in Washington. “But you can certainly talk to our friends in Japan and the Netherlands.”

Bloomberg reported on Friday an agreement had been finalised and two people familiar with the matter later confirmed the news to Reuters.

The United States in October imposed sweeping export restrictions on shipments of chipmaking tools to China, seeking to hobble Beijing’s ability to expand its chip industry and enhance its military capabilities.

For the restrictions to be effective, Washington needed to bring on board the Netherlands and Japan, home to major chipmakers ASML and Tokyo Electron, among others.

The commerce department said in an email it would continue to coordinate on export controls with foreign allies, calling this a “priority”. “We recognise that multilateral controls are more effective than unilateral controls.

Officials from the Netherlands and Japan were in Washington discussing a wide range of issues in talks led by White House national security adviser Jake Sullivan on Friday.

When asked on Friday if an agreement on semiconductors had been discussed, US president Joe Biden said: “Yes, we talked about a lot of things, but a lot of it is private.”

China’s semiconductor industry has become a key target of US export restrictions. Beijing has ploughed money into cultivating its domestic industry but its fabrication plants, known as fabs, still heavily rely on foreign-made equipment.

SMIC, China’s largest fab, makes chips that go into products for the automotive sector, internet-of-things devices and some smartphones.

The US put SMIC on its Entity List in 2020 – effectively barring Dutch firm ASML from providing extreme ultraviolet lithography machines to SMIC.

YMTC is China’s only player in the global Nand memory market – an ultra-competitive sector long dominated by a handful of firms from the US and South Korea. It designs and makes chips and was added to the US Entity List in 2022.

YMTC unveiled a chip in 2022 with 232 layers of memory cells, placing it closer to rivals such as South Korea’s Samsung. Experts said equipment export restrictions are likely to derail further efforts.

CXMT is China’s only major player designing and making Dram chips, which like Nand memory is a sector long dominated by a handful of companies in the United States, South Korea and Taiwan.

With Reuters

Source: https://www.theguardian.com/technology/2023/feb/01/chip-war-japan-netherlands-us-tech-export-ban-china-microchips

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‘It’s just crazy’: Republicans attack US child labor laws as violations rise

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As child labor law violations have been on the rise in the US, some state legislators are pushing for changes at state and federal levels to roll back protections in what some see as a threat to return child labor to the country.

The laws aim to expand permissible work hours, broaden the types of jobs young workers are permitted to do, and shield employers from liability for injuries, illnesses or workplace fatalities involving very young workers.

Child labor law violations have increased in the US, with a 37% increase in fiscal year 2022, including 688 children working in hazardous conditions, with the number likely much higher as the recorded violations stem from what was found during labor inspections.

The Department of Labor issued a press release in July 2022 noting child labor violations and investigations have increased since 2015.

Several high-profile investigations involving child labor have been exposed over the past year, including the use of child labor in Hyundai and Kia supply chains in Alabama, at JBS meatpacking plants in Nebraska and Minnesota, and at fast-food chains including McDonald’s, Dunkin Donuts and Chipotle.

Amid these increases in child labor violations, legislative efforts have been introduced in several states to roll back child labor protections.

In Iowa, Republican legislators introduced a bill in January to expand the types of work 14- and 15-year-olds would be permitted to do as part of approved training programs, extend allowable work hours, and exempt employers from liability if these young workers are sickened, injured or killed on the job.

“It’s just crazy to me that we are re-litigating a lot of things that seem to have been settled 100, 120 or 140 years ago,” said Charlie Wishman, president of the Iowa AFL-CIO, which is opposing the bill.

Wishman added: “All of these protections have been put in place for a reason. Child labor law is there to make sure that kids are working in age-appropriate work activities or occupations that are appropriate for their age. We think this is a rewrite of our child labor laws in Iowa that are going way, way, way too far and has the potential to put kids in dangerous situations.”

The bill would permit the director of Iowa workforce development or the Iowa department of education to grant exceptions from any provision that restricts the types of jobs 14- and 15-year-olds can do if the work is classified as part of a work-based learning program and also strips workers’ compensation rights for these workers.

The protections being sought for companies are of particular concern to labor activists.

“In the Iowa legislation, one of the provisions is to exempt employers from civil liability due to the company’s negligence. It is astounding that they would have the gall to knowingly acknowledge that more young people will be harmed, but focus on exempting businesses,” said Marcy Goldstein-Gelb, co-executive director of the National Council for Occupational Safety and Health.

Goldstein-Gelb explained that throughout her career she has worked with families and co-workers of young workers who have died on the job, oftentimes in violation of child labor laws that industry groups have fought to repeal, such as in a case where a 16-year-old in Massachusetts was killed in 2000 while operating a golf cart on the job.

Young workers have much higher rates of non-fatal injuries on the job and the highest rates of injuries that require emergency department attention, Goldstein-Gelb noted. She argued that due to the vulnerability and inexperience of young workers, data on these workers is likely an undercount due to fears or barriers in being able to speak up and report dangerous situations or child labor law violations.

“I think there is this myth that you need to put young people in any possible job because there are openings. I think we are moving into a new age where we need to recognize that workers of all ages are seeking to earn a sustainable living and not put themselves in harm’s way,” added Goldstein-Gelb. “That’s why there are workers taking actions around the country and that needs to be supported rather than just saying we’re going to find people who have no alternative, the most vulnerable, and put them in jobs that are completely inappropriate.”

Other states are currently or have pushed similar legislation to roll back child labor protections.

In Ohio, legislators reintroduced a bipartisan bill this year to extend working hours for 14- and 15-year-olds with permission from a parent or legal guardian, and called on Congress to adopt the same rollbacks at the federal level.

Legislators in Minnesota introduced a bill in January 2023 to extend work hours for 14- and 15-year-olds.

Republicans in Wisconsin passed a bill that was vetoed by Governor Tony Evers in this month that would have expanded work hours for 14- and 15-year-olds. The New Jersey governor, Phil Murphy, signed a similar law in 2022 that expanded work hours for 14- and 15-year-olds to work longer hours during summer months and on holidays and expanded allowable work hours for 16- and 17-year-olds.

At the federal level, Republican congressman Dave Joyce of Ohio drafted a bill in 2022 to expand working hours for 14- and 15-year-olds during periods when school is in session.

Advocates for legislative efforts to roll back child labor regulations have cited labor shortages, particularly in industries that rely on young workers, and have been strongly backed by the National Federation of Independent Business.

“We think these laws are really ill advised and just asking kids to have negative educational impacts,” said Reid Maki, director of child labor issues and coordinator at the Child Labor Coalition, who argued it took significant efforts to enact child labor laws over 100 years ago, when there were thousands of children working long hours in unsafe jobs such as factories and mines.

Maki added: “Now there are states that want to go back toward that direction to deal with labor shortages by using teens, even to the extent of placing them in dangerous work environments – [it] doesn’t make sense. It’s disregarding their welfare.”

He argued that child labor laws in the US need to be strengthened and updated, including closing existing loopholes that permit young workers, some as young as 12 years old, to work unlimited hours in many jobs in the agriculture industry with parental permission when school is not in session.

An estimated 300,000 to 500,000 minors work in the US agriculture industry annually, with 48% of all young worker fatalities between 2001 to 2015 occurring in the agriculture industry.

“In my office, we can’t bring in a 12-year-old to make copies, 12 is too young, but we will take that same 12-year-old and put them in a field. The actual law allows them to work unlimited hours as long as school is not in session,” added Maki. “There is basically no protection.”

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Chinese billionaire tech banker Bao Fan goes missing

A billionaire Chinese dealmaker has gone missing, plunging one of the country’s top investment banks into turmoil.

Bao Fan, the founder and executive director of China Renaissance, is a major figure in the Chinese tech industry and has played an important role in the emergence of a string of large domestic internet startups.

Shares in China Renaissance slumped after the bank announced to the Hong Kong stock exchange on Thursday that it had been unable to contact Bao, without giving further details.

The stock plunged 50% at one point after the statement, before clawing back to about 30% down.

According to the financial news outlet Caixin, the 52-year-old had been unreachable for two days as of Thursday evening.

The executive committee of China Renaissance told employees not to worry in a message on Friday morning. “[We] believe that everyone has had a restless night. At this time, [we] hope that you do not believe in or spread rumours,” the message said, according to the Wall Street Journal.

Bao’s disappearance is raising concerns over a possible renewed crackdown on China’s finance industry as President Xi Jinping persists in his longstanding campaign against corruption.

The Chinese government has cracked down on several big industries, including technology, education and real estate, as part of Xi’s “common prosperity” drive to “keep income distribution and the means of accumulating wealth well-regulated”.

At least six billionaires have been cowed under Xi, including Jack Ma, the founder of the e-commerce giant Alibaba, who disappeared for three months in 2020 after criticising market regulators.

Willer Chen, a senior analyst at Forsyth Barr Asia, told Bloomberg the executive’s absence “could be a long-term overhang on the stock, given Bao is the key man for the company”.

Wang Wenbin, a spokesperson for China’s foreign ministry, said he was “not aware of the relevant information” when asked about Bao’s disappearance.

“But I can tell you that China is a country under the rule of law,” he said. “The Chinese government protects the legitimate rights of its citizens in accordance with the law.”

China Renaissance has developed into a global financial institution, with more than 700 employees and offices in Beijing, Shanghai, Hong Kong, Singapore and New York.

Bao founded the bank in 2005 after working at Morgan Stanley and Credit Suisse. He competed against Wall Street stalwarts to win mandates on huge deals and stock market listings.

The group has supervised the initial public offerings of several domestic internet giants, including that of the leading e-commerce firm JD.com. Bao also facilitated a 2015 merger between the ride-hailing firm Didi and its main rival at the time, Kuaidi Dache.

Desmond Shum, a Chinese former tycoon, speculated that Bao may have been a target because of his insider knowledge of such deals. Mergers of big companies often involve political as well as business connections.

The case of China Renaissance is reminiscent of a pattern of investigations into the country’s leading financiers in recent years.

In 2017, the Chinese-Canadian businessman Xiao Jianhua was arrested by mainland authorities and received a 13-year jail sentence under corruption charges last August.

Known to hold close ties to top Chinese Communist party leaders, the billionaire was reportedly abducted from his Hong Kong hotel room by plainclothes police officers from Beijing. At the time of his arrest, Xiao was one of the richest people in China, with an estimated fortune of $6bn.

According to Caixin, the China Renaissance president, Cong Lin, was taken into custody last September as authorities launched an investigation into his work at the financial leasing unit of the state-owned bank ICBC.

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Over 100 children illegally employed by US slaughterhouse cleaning firm

More than 100 children have been discovered to be illegally employed by a slaughterhouse cleaning firm across the country, federal authorities said.

The Department of Labor announced that a federal investigation found Wisconsin-based Packers Sanitation Services Inc (PSSI) employed at least 102 children, ranging from 13 to 17 years old, to work overnight shifts at 13 meat processing facilities in eight states.

The investigation discovered that children were working with hazardous chemicals and cleaning meat processing equipment including back saws, brisket saws and head splitters. At least three minors suffered injuries while working for PSSI, one of the country’s largest food safety sanitation service providers.

The states in which the children were employed include Arkansas, Colorado, Indiana, Kansas, Minnesota, Nebraska, Tennessee and Texas. The processor which had the largest number of employed minors is JBS Foods, with 27 children employed, followed by Cargill Inc, which had 26 employed children.

Other processors include Tyson Food, George’s Inc, Buckhead Meat of Minnesota, Gibbon Packing Co, Greater Omaha Packing Co Inc, Maple Leaf Farms and Turkey Valley Farms.

According to court documents, a 14-year-old child who worked at a Nebraska facility from 11pm to 5am five to six days a week from December 2021 to April 2022, cleaned machines “used to cut meat”.

At one point, the child fell asleep in class and also missed class after suffering injuries as a result of chemical burns. Several other children were also reported to have suffered from chemical burns.

The Department of Labor assessed PSSI $15,138 for each minor-aged employee who was employed in violation of the law. According to the news release, PSSI has paid $1.5m in civil money penalties.

“The child labor violations in this case were systemic and reached across eight states, and clearly indicate a corporate-wide failure by Packers Sanitation Services at all levels,” said Jessica Looman, the department’s principal deputy administrator of the wage and hour division.

“These children should never have been employed in meat packing plants and this can only happen when employers do not take responsibility to prevent child labor violations from occurring in the first place.”

Meanwhile, Michael Lazzeri, a Chicago-based regional administrator with the labor department, said that when the wage and hour division arrived with warrants, “the adults – who had recruited, hired and supervised these children – tried to derail our efforts to investigate their employment practices”.

During fiscal year 2022, there was a 37% increase in child labor law violations across the country, with at least 688 children working in dangerous conditions.

Despite the Department of Labor’s warnings that child labor violations have increased since 2015, Republican lawmakers across the country have in recent months been pushing for the expansion of the types of approved work, as well as work hours.

“Now there are states that want to go back toward that direction to deal with labor shortages by using teens, even to the extent of placing them in dangerous work environments – [it] doesn’t make sense. It’s disregarding their welfare,” Reid Maki, director of child labor issues and coordinator at the Child Labor Coalition, told the Guardian.

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