US teases more China tech sanctions, this time to deflate balloon-makers

State Dept already has one target, FBI is identifying sources of floating surveillance platform's components

The Chinese surveillance balloon that drifted across the US last week looks set to spark a new round of sanctions against Middle Kingdom tech firms.

Ned Price, the State Department spokesperson said on Thursday, "We're exploring taking action against PRC entities linked to the PLA that supported the balloon's incursion into US airspace."

"We're always going to take action to protect our people, to protect our interests, to guard against what is a challenge to those," he added.

"And if it's appropriate for us to respond, whether it's against PLA related entities, or to continue the type of declassifications and public releases that we've been doing, that's something we won't hesitate to do."

Another State Department official earlier said the US government is "confident that the balloon manufacturer has a direct relationship with China's military and is an approved vendor of the PLA, according to information published in an official procurement portal for the PLA."

The FBI, meanwhile, has detailed its efforts to recover the balloon, including efforts to "determine the source of the balloon components."

The US bans on exporting tech to China were made on the basis of an assessment – contained in a White House Fact Sheet – that "the use of Chinese surveillance technology outside the PRC, as well as the development or use of Chinese surveillance technology to facilitate repression or serious human rights abuses, constitute unusual and extraordinary threats."

The balloon clearly meets the same threshold, so sanctions of the sort imposed on Huawei, ZTE, and other Chinese companies would seem to be a proportionate response to a spy balloon being deployed towards sovereign airspace.

The State Department has not said what it plans to do to any entities identified as part of ongoing investigations of the balloon, but chip tech bans certainly offer a playbook to follow. ®