Except that the response would be that any product with that IP will be banned from EU/USA. That is a huge hit to take.

But it's pretty hard to know what devices even contain that IP... Does that Amazon Basics optical gaming mouse contain an ARM CPU? It would probably take weeks of decapping the chip and reverse engineering the CPU to be sure, and even then, figuring out if that CPU is licensed or not is non-trivial. Is customs really going to do that for every item that comes through the border?

Well suffering sanctions and being left without foundamental technology is already a huge hit

With all due respect to China, licensing on fair terms has never been a requirement for state-sponsored intellectual property theft.

With all due respect to the USA, never been a requirement for United States state-sponsored intellectual property theft either.

But goods infringing IP can presumably be prevented from import into western markets?

That’s fine until your entire planet runs on ARM IP made in china. China pulls the plug then we’re all in trouble.

What would happen is another mutually assured destruction stalemate.