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With China's rapid rise in economic and military power, the United States has found it increasingly difficult to thwart China's emergence on the global stage. In order to maintain its global hegemonic status, the United States has adopted a variety of means, especially in the field of science and technology, and has frequently suppressed China, especially in the semiconductor industry. Semiconductor technology is considered to be the core of the third scientific and technological revolution, and the United States is trying to limit China forever to European and American countries by restricting China's access to semiconductor technology.
However, the recently signed CHIP Act in the United States restricts the export of chips to China, which has led to unexpected consequences. China has taken countermeasures, notably by restricting exports of rare materials such as gallium and germanium. These two materials are crucial in semiconductor manufacturing, and China is the main supplier. The restriction turned America's efforts to suppress China into a joke. Who will be the ultimate winner in this chip war?
First, let's review how technological change has shaped the world. The fact that Western countries have been able to enjoy a prosperous life is largely due to the effects of several industrial revolutions. The first industrial revolution took place from the 60s of the 18th century to the 40s of the 19th century, which allowed Western countries to achieve the transcendence of the East for the first time and laid the foundation of capitalism. The second industrial revolution took place in the mid-19th century, ushering humanity into the "electric age" and accelerating the transformation of the world. The third industrial revolution, represented by semiconductor technology, has had a profound impact on the development of productive forces. Semiconductor technology is the foundation of integrated circuits, consumer electronics and communication systems, and chips are the core components of integrated circuits.
Although China has made impressive progress in many areas, there are still huge gaps in chip technology. If China can overcome this technological hurdle, the gap between China and the United States will quickly narrow. As a result, China has been actively increasing its investment in the chip sector, while the United States has taken restrictive measures in an attempt to put China's chip industry at a disadvantage.
The motivation behind the U.S. chip wars is to influence China's AI industry, as semiconductor technology is key to achieving this. The United States is trying to fundamentally dismantle China's advanced technology ecosystem to ensure that China does not make any progress in the field of technology. However, the war did not defeat China, because even U.S. allies and domestic voices of opposition.
The Chips and Science Act, recently signed by the U.S. government, provides tens of billions of dollars in aid to support semiconductor R&D and manufacturing, and in particular incentivize semiconductor manufacturing. However, only about 10% of semiconductors in the United States are produced domestically. In addition, the United States plans to cut taxes to encourage companies to build chip factories in the United States. Despite these measures taken by the United States, the globalization of the chip industry has become an irreversible trend.
In fact, the global chip market is inseparable from China. China is not only the world's largest manufacturer of electronic products, but also a major importer of semiconductors in the world. Therefore, U.S. restrictions have not only failed to curb China, but have hurt the U.S. chip industry. American chip giants such as Intel, Nvidia and Qualcomm have all suffered. The outcome of this chip war will ultimately prove that China is the country most likely to overcome the challenge. Technological change is driving changes in the global landscape, and China will continue to play an important role in this process.
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