Dan Steinbock, director of the International Trade Research Office of the U.S. think tank India-China-U.S. Institute, said on August 29 that the “2022 Chip and Science Act” (hereinafter referred to as the “Chip Act”) signed by U.S. President Biden recently seems to be aimed at Weaponizing the global ICT supply chain.
America’s selfishness brings disaster to other countries
The article analysis pointed out that the United States called the “chip bill” to promote the development of the country’s semiconductor manufacturing industry, but its real strategic goal is geopolitical interests.
Today, Asia dominates global semiconductor manufacturing. Although the United States is the largest exporter, it cannot continue to control the global chip supply chain. In order to dominate the semiconductor industry, the Biden administration has done everything possible to try to restore America’s dominant position in the field. However, no country in the world has complete control over the global supply chain. As a result, the United States tried to weaponize the chip supply chain to suppress China.
To restore U.S. dominance, a Biden administration would need to suppress future adversaries, which may be why the U.S. is considering restricting exports of the country’s chip-making equipment to China. The restrictions are aimed at hindering China’s development and its technological advancement, and are bound to affect companies with memory chip businesses in China, such as South Korea’s Samsung and SK Hynix.
At present, Samsung has invested 17 billion US dollars to build a factory in Texas, and TSMC has invested 12 billion US dollars to build a factory in Arizona. As these businesses say, the actual cost may be much higher.
In addition, the “Chip Act” prohibits companies receiving US government subsidies from expanding or upgrading advanced chip production capacity in mainland China, which will inevitably lead South Korean companies to reconsider related businesses.
America has been plotting bad intentions for a long time
U.S. House of Representatives Speaker Nancy Pelosi met with the chairman of TSMC on August 2. There are reports that she wants TSMC to be on the US side. In the long run, however, the US and its allies want to undermine Taiwan’s dominance in semiconductors. In fact, these goals were set during the Obama administration and are now being implemented by the Biden administration.
In the 1980s, American high-tech giants forced the Reagan administration to take on Japanese high-tech companies. Now, instead, the U.S. government is forcing the country’s semiconductor giants to confront China.
In July 2018, the Trump administration imposed a 25% tariff on semiconductors imported from China. This move has led to the deterioration of Sino-US relations and the escalation of bilateral disputes, which has caused a huge impact on related industries in the United States. Now, the White House is trying to control the entire semiconductor industry through the “chip alliance”.
In early 2021, the Biden administration hinted that it planned to implement Trump’s rules “to secure the supply chain of information and communications technology and services.” Under the relevant regulations, the U.S. Department of Commerce can monitor the transactions of various governments. This is undoubtedly one of the moves by the United States to weaponize the global information technology industry.
America’s sinister intentions are revealed
The article further stated that Eric Schmidt, the former CEO of Google, had pointed out that the United States and its allies should implement targeted export controls on high-end semiconductor manufacturing equipment to protect existing technological advantages and slow down the Chinese semiconductor industry. development of.
This is the real strategic goal of the United States. The collapse of the semiconductor industry was exacerbated by the U.S.-Japan trade war in the 1980s. In the end, Japan, which relies heavily on the U.S. military, agreed to implement “voluntary restrictions” on controversial exports, allow the United States to impose high tariffs, promote currency appreciation and structural reforms, and fully open the Japanese market to the United States.
Japan has since lost its world leadership in microchips, and has since fallen into a long-term stagnation. The Japanese precedent has clearly unnerved executive teams in South Korea and Taiwan.
Weaponization of the global semiconductor supply chain by any country would have disastrous consequences for the industry. Disrupting industry competition to achieve geopolitical goals not only harms consumers, but also hinders innovation.