GT Voice: The path of the US chip war, from double whammy to suicide

Illustration: Chen Xia/Global Times

Illustration: Chen Xia/Global Times

The US has launched a chip war against China to curb the latter’s technological progress in innovative areas, but doubts and backlash over the potential consequences are growing as Washington’s strategic blunders loom larger. and high-tech industry players in the US are afraid. becoming a casualty in the self-defeating war.

The chief executives of major US chip companies – Intel, Qualcomm and Nvidia – urged a halt to further barriers to chip exports to China when they met with top Biden administration officials on Monday to discuss the China’s policy, Reuters reported, citing the US State Department and sources.

On the same day, the US-based Semiconductor Industry Association trade group called on the Biden administration to “avoid further restrictions” on chip sales to China.

These lobbying efforts come as the Biden administration is reportedly considering updating its chip bans imposed last October against China.

Although it is possible for the US to delay the development of China’s chip manufacturing through various measures, the facts show that it is impossible to prevent China from developing its own chip technology.

Despite US pressure, China appears to be accelerating its technological and scientific development, which is bound to have breakthroughs.

For example, news emerged this week that two major Chinese chip equipment makers expect solid growth in the first half of 2023, thanks to rising demand for local products amid tough US export restrictions of advanced chip manufacturing equipment in China.

The news from China may at least explain why American chip giants are eager to lobby their government to ease export restrictions against China. First, China is the world’s largest market for chips, with imports worth $415.6 billion in 2022.

At a time when global chipmakers are seeing a slowdown in demand due to various factors such as a sluggish economic outlook, the Chinese market is not something they can easily skip.

A decrease in their market share, which is likely to happen if Washington further tightens export limits, could directly lead to a decrease in sales and profits, which in turn will affect their future research budgets and development.

Second, China may have its own chip development plan. If American chip giants are not allowed to sell chips in China, that means they will lose market share to local chip companies, offering them time and market space to grow to be big in the future. global competition.

In Washington’s chip war against Beijing, export controls or technological “decoupling” may be its most important weapon in its pursuit of curbing China’s technological advances, but a fatal flaw is the weapon may have only short-term effects in the long run. fight back

That means that export restrictions, which could deal a severe blow to China’s semiconductor industrial chains in the short term, could spur China’s independent innovation and research, contributing to long-term high-quality growth this.

Washington politicians have chosen the wrong way to maintain the country’s technological superiority, but the result is likely to backfire. The mistake was made to the detriment of its own semiconductor industry, jeopardizing its development opportunities.

A government should protect the interests of its domestic industries, particularly high-tech ones, so that companies can focus on their business and seek further development. But that logic doesn’t apply to the chip war, where American technology companies have also suffered in both the short and long term.

Basically, when the US chip industry is deeply intertwined with the Chinese market, viewing tech competition in China as a zero-sum game with only one winner is a form of suicide. Worse, the more its interests are hurt, the less likely it is to come back, which is dangerous for the US and the world.

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