The U.S. and China are fighting a fierce battle for semiconductors amid high interdependence,
Although the U.S. continues to attempt decoupling to isolate China from the global market, it is diagnosed that the semiconductor industry still sees the Chinese market as the key to survival.
‘One reason why the U.S. cannot give up China? An analysis article titled ‘Semiconductor’ introduced the current status of the semiconductor industry in the middle of the U.S.-China conflict.Until now, the U.S. authorities have tightened regulations on semiconductor exports, saying that exports to China undermine national security, while introducing various support measures for the establishment of factories in the U.S.However, he pointed out that despite these efforts by the U.S., relations between the U.S. and Chinese companies are still strong in front of the huge market in China.Representatively, U.S. semiconductor company Micron announced last month that it will invest an additional $600 million in Chinese semiconductor packaging plants even after being sanctioned by China.
Micron also stressed on his Chinese social media account that “this investment shows Micron’s firm commitment to Chinese business and organization.”The reason why China can maintain such a market position is that it is a key production base for various electronic products such as smartphones, automobiles, and PCs that are in high demand for semiconductors.
It is estimated that China accounts for one-third of the world’s semiconductor sales, and some semiconductor companies say that 60-70% of their sales come from China.In addition, even semiconductors manufactured in the United States are undergoing final assembly or testing in China.Emily S. Weinstein, a researcher at the Center for Security and New Technology (CSET), a technology policy research organization at Georgetown University, pointed out, “We can’t say that everything should be withdrawn from China out of the blue like a switch is raised.” It was evaluated that these situations show how great a challenge the current U.S.-China economic relationship is to both sides.The NYT explained that this tension between the two sides was also evident during U.S. Treasury Secretary Janet Yellen’s recent visit to China. During the visit, Yellen criticized China’s practices while also giving a message that the U.S. has no intention of breaking ties with China, and had to carry out tightrope diplomacy.John Neoper, chairman of the U.S. Semiconductor Association (SIA), argued that the continued expansion of control between the U.S. and China posed a significant risk to the global competitiveness of the U.S. semiconductor industry.
“Our companies need to work there (China) for continued growth and innovation, and to stay ahead of their global competitors,” he pointed outEven in this situation, the US government’s decoupling movement continues as a fundamental policy stance.The U.S. government is expected to make massive investments to attract semiconductor factories this year and make conditions to refrain from expanding facilities in China.Recently, it is known that Chinese companies are also preparing to restrict access to cloud computing to protect advanced technologies such as artificial intelligence (AI).It is also said that it is considering suspending export licenses for some U.S. semiconductor manufacturers that were able to sell their products to Chinese telecommunications company Huawei.In response, China is responding by announcing that it will control exports of gallium and germanium, which are rare metals for semiconductors. It is a general observation that the technological hegemony battle between the U.S. and China, which is centered on semiconductors, called “rice of high-tech industries,” will not be fundamentally resolved despite some speed control.
KS CHOI
US ASIA JOURNAL
