Wow, designed to backfire
The Chinese have managed to produce 7nm semiconductors without EUV. This is a task Intel spent billions on and failed. They will continue to innovate and advance their semiconductor production. They will continue to shrink their processes without outside technology.
Of course, their advancements mean that they will produce chips for a LOT less money than other companies.
By adding clauses blocking collaboration between China and the U.S., the U.S. will be unable to compete.