Growth Dragons Weekly: US Reverses EDA Ban, Alibaba Launches $7B Price War, Moutai Shunned, Developer Stocks Rally, and 500 IPOs in Queue
What happened in China this week:
US Lifts EDA Software Ban, China Releases Rare Earths — But the Trade War Isn’t Over
Tech Competition Intensifies — Alibaba Throws US$7 Billion at Meituan, Baidu Reinvents Search with AI
Beijing Bans Booze at Official Meals — Moutai Prices Drop on Weak Demand
HK-Listed Developers Rally Over 10%—Is the Recovery For Real?
Over 500 Companies Lined Up to List in China and Hong Kong—IPO Momentum Builds
#1 US Lifts EDA Software Ban, China Releases Rare Earths — But the Trade War Isn’t Over
On 2 July, the U.S. Commerce Department abruptly rescinded its five-week-old export licence rule, allowing Synopsys (SNPS) and Cadence (CDNS) to resume full sales of electronic-design-automation (EDA) tools to Chinese semiconductor firms. Shares of both companies jumped 4–6% intraday. EDA software is essential for designing chips, and the reinstated access offers Chinese firms like Huawei’s HiSilicon, SMIC, and various AI-chip startups a crucial lifeline to keep their R&D on track.
In return, Beijing has begun clearing the backlog of magnet-grade rare-earth export licences—a bottleneck that had rattled U.S. defence contractors earlier this year. For now, it seems both sides are holding to the promises made during the London Framework meeting. But the reality remains: tensions are high and trust is low. The U.S.–China relationship is so fragile that any move perceived as adversarial could reignite trade hostilities.
A clear example is the recent U.S.–Vietnam trade deal, which imposes a 40% “anti-transshipment” tariff on goods that originate from China but are routed through Vietnam to avoid tariffs. Vietnam has long been a popular transshipment hub for Chinese exports. Under the new deal, genuine Vietnamese goods are taxed at 20%, but re-routed Chinese goods now face double that. It’s a direct attempt to plug the loophole.
China’s commerce ministry has warned it will “take counter-measures” against any country that signs trade agreements “at China’s expense.” We’ll have to wait and see how Beijing responds, though the growing presence of Chinese factories in Vietnam might help cushion the impact.
Meanwhile, the clock is ticking. The 90-day global tariff suspension ends on Tuesday, 9 July. If no extension is granted, baseline duties will snap back to 10% for most countries, and far higher for China—especially under Trump’s executive order from April. If that happens, expect another round of retaliation from Beijing.
Bottom line: don’t mistake recent concessions for reconciliation. Trade tensions will continue until global powers feel they’ve secured their “fair share” of trade. Every new deal may not be de-escalation—it could just be the next countermove in a prolonged economic chess match.