By Alexandra Alper, Michael Martina, Jeffrey Dastin and Karen Freifeld (Reuters) -The Trump administration is considering a plan to curb a dizzying array of software-powered exports to China, from laptops to jet engines, to retaliate against Beijing's latest round of rare earth export restrictions, according to a U.S. official and three people briefed by U.S. authorities. While the plan is not the only option on the table, it would make good on President Donald Trump's threat earlier this month to bar "critical software" exports to China by restricting global shipments of items that contain U.S. software or were produced using U.S. software. On October 10, Trump said in a social media post that he would impose additional tariffs of 100% on China's U.S.-bound shipments, along with new export controls on "any and all critical software" by November 1 without further details. To be sure, the measure, details of which are being reported for the first time, may not move forward, the sources said. But the fact that such controls are being considered shows the Trump administration is weighing a dramatic escalation of its showdown with China, even as some within the U.S. government favor a gentler approach, according to two of the sources. The White House declined to comment. The Commerce Department, which oversees export controls, did not respond to requests for comment. A spokesperson for the Chinese embassy did not comment on the specific U.S. measures under consideration but said China opposed the U.S. "imposing unilateral long-arm jurisdiction measures" and vowed to "take resolute measures to protect its legitimate rights and interests" if the U.S. proceeds down what it views as a wrong path. Administration officials could announce the measure to put pressure on China but stop short of implementing it, one of the sources said. Narrower policy proposals are also being discussed, two of the people said. "Everything imaginable is made with U.S. software," one of the sources said, highlighting the broad scope of the proposed action. The sources declined to be named because the matter was not public. The move could disrupt global trade with China, especially for technology products, and could come at a cost to the U.S. economy if fully implemented. The measure, if adopted, would echo restrictions that the Biden administration imposed on Moscow after its 2022 invasion of Ukraine. Those rules restricted exports to Russia of items made globally using U.S. technology or software. Trump's Truth Social post came just three weeks before a previously announced meeting with Chinese President Xi Jinping in South Korea, and a day after China dramatically expanded its export controls on rare earth elements. China dominates the market for such elements, which are essential to tech manufacturing. In his post, Trump said China's action, also effective November 1, represented "a moral disgrace" that would impose controls on "virtually every product they make." But questions have swirled about what Trump meant in his response by "critical software" controls. While Trump has slapped a series of tariffs on China since taking office in January, he has wavered in his use of export restrictions against Beijing, first imposing strict new curbs on shipments of Nvidia's AI chips as well as chip design software to China, and later removing them. China expressed its opposition to a Trump administration rule last month that restricts U.S. companies from shipping goods and technology to companies at least 50% owned by sanctioned Chinese firms. (Reporting by Alexandra Alper and Michael Martina in Washington, Jeffrey Dastin in San Francisco and Karen Freifeld in New York; Editing by Chris Sanders and Edmund Klamann)
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