Exploring the impact of US export controls on advanced semiconductor chips on US-China relations and China's technological development, the United States Bureau of Industry and Security's declaration of economic war on China through a document issued by the bureau, China's rise in supercomputers and vulnerability, the United States' controls on semiconductors and Taiwan's crucial role in chip production, and the unequal partnership in chip manufacturing between the US and Taiwan.
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Quick takeaways
The US implemented export controls on advanced semiconductor chips to hinder China's technological progress and military development, establishing a non-proliferation regime and setting the stage for a technological cold war.
The US holds significant power over the global semiconductor market, leveraging export controls to restrict China's access to semiconductors and hamper its technological advancement, targeting companies and seeking cooperation from countries aligned with the US.
Deep dives
US Export Controls on Advanced Semiconductor Chips
The US implemented export controls on advanced semiconductor chips on October 7, 2022, in an effort to hinder China's technological progress and military development. These controls aim to restrict China's access to cutting-edge chips used for supercomputers, artificial intelligence, and smart weapons. The US government declared advanced chips a matter of national security, effectively cutting off China's entire supply chain and forcing them to play catch up. This move establishes a non-proliferation regime for chips and sets the stage for a technological cold war between the two countries.
American Control over Semiconductor Supply Chain
The US holds significant power over the global semiconductor market due to its dominance in chip design software and manufacturing tools. American companies mostly supply the world with semiconductors, and other countries heavily rely on US technology and components. By leveraging this control, the US has been intensifying export controls to restrict China's access to semiconductors and hamper its technological advancement. This strategy involves targeting companies and entire industries and seeking cooperation from countries like Taiwan, Japan, and the Netherlands to align their controls with the US.
Challenges and Loopholes in Enforcing Controls
The enforcement of export controls faces challenges due to the small size and high value of semiconductors, making them attractive to smugglers. China's need for large quantities of chips for data centers and advanced computers also presents procurement difficulties. However, the controls have proven effective in curtailing illicit underground markets for chips in China. To ensure compliance, the US heavily relies on private companies, which may find it challenging to cut off a lucrative Chinese market. Nonetheless, China's determined efforts and domestic chip production aspirations may eventually lead to self-sufficiency and technological catch-up.
Long-Term Implications and Uncertain Outcomes
The US export controls could handicap China's chip-making ability for a generation, impacting its military advancements, economic growth, and scientific leadership. The controls aim to delay China's progress and provide an opportunity for the US and its allies to expand their technological lead. However, the outcome remains uncertain, as the controls may spur China's domestic innovation and lead to self-reliance. The success or failure of these controls will shape the future of US-China competition and have long-lasting implications for the global order.
Last October, the United States Bureau of Industry and Security issued a document that, underneath its 139 pages of dense bureaucratic jargon and minute technical detail, amounted to a declaration of economic war on China. The magnitude of the act was made all the more remarkable by the relative obscurity of its source.
In recent years, semiconductor chips have become central to the bureau’s work. Despite the immense intricacy of their design, semiconductors are, in a sense, quite simple: tiny pieces of silicon carved with arrays of circuits. The chips are the lifeblood of the modern economy and the brains of every electronic device and system, including iPhones, toasters, data centers and credit cards. A new car might have more than a thousand chips, each one managing a different facet of the vehicle’s operation. Semiconductors are also the driving force behind the innovations poised to revolutionize life over the next century, like quantum computing and artificial intelligence. OpenAI’s ChatGPT, for example, was reportedly trained on 10,000 of the most advanced chips available.
Though delivered in the unassuming form of updated export rules, the Oct. 7 controls essentially seek to eradicate, root and branch, China’s entire ecosystem of advanced technology. If the controls succeed, they could handicap China for a generation; if they fail, they may backfire spectacularly, hastening the very future the United States is trying desperately to avoid.
This story was recorded by Audm. To hear more audio stories from publications like The New York Times, download Audm for iPhone or Android.
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