US Eases Chip Software Export Restrictions to China After Trade Talks in London

US Lifts Chip Software Export Ban on China Following Breakthrough Trade Deal

The United States has officially rescinded export restrictions on chip design software to China, signaling a shift in the tense technology standoff between the two economic superpowers. The move follows high-stakes trade negotiations in London last month and marks a tangible step toward stabilizing fragile US-China trade relations.

The reversal affects electronic design automation (EDA) software, a critical tool used to develop semiconductors, and lifts restrictions that were introduced by the Trump administration in May. Those controls had cut off China from accessing products developed by Synopsys, Cadence, and Siemens, which together dominate over 70% of China's EDA software market, according to Chinese state media.

Tech Concessions Follow London Agreement

The export policy rollback was part of a broader tech-focused trade agreement brokered in London. Under the deal:

• The US agreed to lift restrictions on chip design software, jet engine exports, and the chemical ethane.

• China agreed to resume rare earth exports to the US under its controlled licensing regime.

Each of the affected companies confirmed the US Commerce Department notified them that the previous export curbs were no longer in effect. Cadence and Siemens have already resumed software support and access for Chinese customers, while Synopsys said it’s evaluating the broader impact on its operations and revenue.

“We’ve reinstated access to restricted software and resumed full support,” a Siemens spokesperson confirmed.

Rare Earths: China’s Key Leverage in Trade Talks

The original EDA software ban came in retaliation for China’s export curbs on rare earth minerals, which are essential for electronics, electric vehicles, and military technologies. China controls approximately 90% of global rare earth processing, and in April imposed new licensing requirements that effectively halted exports of several types of rare earth minerals and magnets.

Although a temporary 90-day trade truce was declared after May's Geneva talks, China initially did not ease its rare earth restrictions, prompting the US to escalate with more tech export bans—until the London meeting reopened cooperation channels.

Ethane and Jet Engine Exports Also Greenlit

As part of the same agreement, the US has also:

• Lifted restrictions on ethane exports, crucial for plastics manufacturing. Nearly 50% of American ethane exports in 2024 were bound for China.

• Approved jet engine shipments to China, with GE Aerospace reportedly restarting deliveries, according to Reuters.

China’s Ministry of Commerce confirmed the developments and emphasized that both sides are “actively implementing” the London trade framework.

“Cooperation, not coercion, is the correct path forward,” a Chinese official stated. “We hope the US continues correcting its previous misguided actions.”

Tariff Tensions Remain Despite Tech Deal

While the London agreement addresses several high-impact export restrictions, tariffs remain a sticking point. President Trump said US tariffs on Chinese goods still average 55%, factoring in:

• A 10% “reciprocal” tariff placed on all trade partners in April

• A 20% tariff targeting Chinese imports over alleged fentanyl trafficking

• Pre-existing duties from earlier trade disputes

In contrast, China has agreed to limit its tariffs on US goods to 10%, though it's unclear if this includes new or existing levies.

Although Beijing did not dispute Trump’s claims publicly, the August expiration of the current trade truce could spark renewed tensions unless further progress is made.

What This Means for the Semiconductor Industry

The original ban on chip design tools posed a serious threat to China’s semiconductor ambitions. The three lifted restrictions now give Chinese firms temporary relief and the ability to continue innovating in chip development, a vital area of geopolitical competition.

Analysts warn, however, that these temporary agreements could unravel quickly without a more durable long-term trade strategy.

“This move buys time,” one trade expert told CNN. “But the tech war is far from over.”