The President of the United States Joe Biden signed an executive order on Thursday to strengthen the implementation of the CHIPS and Science Act recently, which sets aside $ 280 billion to strengthen the production of semiconductors in domestic and technological research.
The second measure, signed into law this month, is aimed in part at reducing the United States’ “dependence on critical technologies from China and other vulnerable or over-resourced foreign suppliers,” according to the order.
Although the move was met with some opposition in Congress, and Republicans worried that it would severely limit the US’s ability to spend elsewhere, the move was considered a major advance in protecting the United States from the current economic crisis. Republicans everywhere cheered on the bill out of concern for national security amid fears of a Chinese attack on Taiwan, which alone pumps two-thirds of the world’s semiconductors.
The President of the United States Joe Biden signed an executive order on Thursday to strengthen the implementation of the CHIPS and Science Act recently, which sets aside $ 280 billion to strengthen the production of semiconductors in domestic and technological research.
The second measure, signed into law this month, is aimed in part at reducing the United States’ “dependence on critical technologies from China and other vulnerable or over-resourced foreign suppliers,” according to the order.
Although the move was met with some opposition in Congress, and Republicans worried that it would severely limit the US’s ability to spend elsewhere, the move was considered a major advance in protecting the United States from the current economic crisis. Republicans everywhere cheered on the bill out of concern for national security amid fears of a Chinese attack on Taiwan, which alone pumps two-thirds of the world’s semiconductors.
Semiconductors—the building blocks of computer toys and critical components of all electronic devices—are now fundamental to everyday life. Small electric motors are essential to businesses from cars to defense to home appliances, such as toasters and cell phones, and the United States does not want to be left behind.
What exactly is the CHIPS Act and Science?
At its core, it is an industrial policy aimed at protecting the United States from serious economic risks. “But it is most dangerous in the chip sector, which is the heart of everything we use,” said Shihoko Goto, director for geoeconomics and Indo-Pacific enterprise at the Wilson Center.
The integration of the CHIP and Science Act, which reserves $52 billion for chipmakers who are building new factories in the United States, is designed to expand the production of semiconductors within the borders of the country , reducing its problem with the supply of emergencies such as the lack of cars that occurred during the epidemic. .
But there was also an added urgency for the United States to expand domestic chip production because of tensions in Asia, especially between China and Taiwan. Heeding warnings that China is increasing its ability to attack Taiwan, U.S. semiconductor manufacturers will help ensure that U.S. businesses are not enslaved in China if the country is attacked.
“The problem in the US – including the US military, because it is very dependent on advanced semiconductors – is very high,” said Robert Atkinson, the founder and president of Knowledge science and technology is the Information Technology and Innovation Foundation. “Really, basically, it’s a [national] defense.”
Can the United States restore semiconductors at the stroke of a pen?
Not in the near future. Currently, only the Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung, in Taiwan and South Korea, respectively, have the capacity to produce semiconductor technology-used in industry and power electric vehicles. The CHIPS and Science Act will help boost manufacturing—beyond consumer goods and cell phones—in the United States.
But it will take time. Asia’s supply chain has been built on chips for the past two decades, said Daniel Ives, a managing director who focuses on the technology sector at Los Angeles-based private equity firm Wedbush Securities.
“All parts and suppliers are in and around Taiwan, Vietnam, China, Cambodia, Malaysia,” Ives said. “You can’t do that with the snap of a finger in the US anymore.”
Ives said he doesn’t see any real progress in the next three to five years because of the time it takes to build the country’s manufacturing. Although the CHIPS initiative is being established, it is only a first step. “The operation of CHIPS looks good on paper from a strategic point of view, but the implementation will be very difficult,” he said.
What does this mean in terms of US-China competition? What is China doing?
While the United States still holds the world market leadership, China is putting a large amount of money into semiconductors, as part of its plan to assert its leadership in the world in terms of size. the technological industry in the world in this decade. “Their wallet is pretty much unlimited,” Atkinson said. China, the world’s fastest growing economy, is the largest exporter of goods and has the fastest growing market.
Forty years ago, the United States produced nearly 40 percent of the world’s semiconductors domestically. But production fell sharply due to slow demand after the Cold War. Today, the United States accounts for only 12 percent of the world’s chip market, Atkinson said.
But, most of China’s investment is passive; China’s technology and infrastructure lag behind the United States, experts say. China has been trying to build a strong semiconductor industry for more than 40 years, said James Lewis, senior vice president and director of the technology program at the Center for Strategic and International Studies. They didn’t succeed, but they didn’t give up. “And they’re willing to spend a lot,” he said. China’s goal for computers is similar to its previous ambitions for the telecommunications market, which is led by the Chinese telecommunications company Huawei. “They want to be independent of the West, and they want to control the world market.”
But the United States does not want him or his followers to fall further into China. Europe, especially Germany, has become increasingly dependent on trade with China. And the United States wants to avoid relying on technology in the future in Asia. The head is enough with the unusual ground and the protection part.
“It is intended to ensure that the United States is capable of strengthening the economy,” said Goto.
Where does Taiwan come into all this?
Taiwan, in particular, dominates the chip industry, which the small island has used to its advantage to counter China. TSMC is the largest and most important company in Taiwan, and is also looking to establish more in Southeast Asia.
“The Taiwanese decided, ‘We’re going to be so important in chip production that China can’t attack us,'” Lewis said.
But, from Washington’s point of view, it is trickery; knowing its dependence on Taiwan – which is vulnerable to China’s economic and possibly military strengthening – the United States and other countries of the world are looking to increase production at home.
What makes semiconductors so important?
“The world has become digital. The number depends on the chips,” Lewis said. “They’re in the food. They’re in your electric toothbrush. They’re in your car.”
The expansion of semiconductor production in the country is a long-term investment, said Atkinson, because he estimated that the United States could double its share of the chip market within the next decade. “I think it’s going to be a game changer.”
“The CHIP law is the beginning; It’s necessary,” said Goto, adding that the United States must address all aspects of the semiconductor supply chain—investing in research and design, manufacturing, the use of precious minerals, and people. “The what the semiconductor industry really needs is an organization.”
In fact, American semiconductor companies do most of their manufacturing in the United States, and semiconductors are one of America’s top manufacturing products, behind airplanes and cars. The data below shows the strength and importance of the United States semiconductor industry. 1.
Can US make car chips?
Chips made in the US But now, only 12% are made here. Of the premium chips, 0% are made in America. Those are made in Taiwan and China. The Detroit Big Three automakers have been forced to slow or stop production.
Who makes toy computers for cars in the US? Highlights: The global automotive semiconductor market is estimated at USD 43. Read also : US-Pakistan health dialogue launched to deepen health sector cooperation – US Department of State.6 billion by 2021. Infineon, NXP, and Renesas are the largest automotive semiconductor manufacturers.
What country makes vehicle chips?
The chips underpin the world’s technology economy of about $3 billion, the report said. Materials for the semiconductor industry usually come from Japan and Mexico, with chips made in Taiwan, China and some in the US.
Why can’t the US produce car chips?
While the lack of chips can be caused by many things, the COVID-19 disease is the main reason. At the beginning of the disease, car manufacturers closed factories and temporarily stopped the production of cars. Read also : The United States Does Not Allow More Immigration Than All The Countries Combined. Meanwhile, lockdowns and special and educational projects have led to an increase in demand for other electrical appliances.
Why is Taiwan the only chip manufacturer?
“China is dependent on Taiwan because even though Chinese companies can design semiconductors, they only have limited manufacturing capabilities, especially at the top end,” Lee said. On the same subject : Suddenly, the US is a climate leader.
Why are all the chips manufactured in Taiwan? Taiwan relies on its dominance of the microchip industry for its protection. The “silicon shield” theory says that since its semiconductor industry is very important to the production of China and the consumer economy of the United States, actions that threaten its foundations will be very dangerous.
What percent of US chips are made in Taiwan?
This scenario will present a lot of problems for the US because Taiwan produces 90 percent of the country’s best-selling toys, according to Raimondo.
How did Taiwan become semiconductor industry?
They wanted to invest in investment in packaging, the last part of the production process, for foreign companies. So, to strengthen cooperation, the government established the Hsinchu Science Park, which will become Taiwan’s own Silicon Valley. By 1980, Taiwan had its first semiconductor company.
Does Taiwan make all the chips?
Taiwan dominates the world’s supply of computer hardware – no wonder the US is worried.
Is Taiwan part of NATO?
2151 et seq.), or any other provision of law, Taiwan shall be treated as if designated as a major non-NATO party (as defined in section 644(q) of the Foreign Assistance Act of 1961 (22 U.S.C. 2403(q). ))[)]."
What countries are in NATO 2022? List of NATO Countries 2022
- Canada (1949)
- Croatia (2009)
- France (1949)
- Germany (1955)
- Greece (1952)
- Hungary (1999)
- Czech Republic (1999)
- Denmark (1949)
Which countries are in NATO?
Current NATO members are Albania, Belgium, Bulgaria, Canada, Croatia, Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Lithuania, Luxembourg, Montenegro, Netherlands, North Macedonia, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Turkey, …
Is China a member of NATO?
None of them are members of NATO, but they are aware of the growing influence and pressure of China. Since 2020, NATO has developed cooperation with four Asian democracies, which are called “Asia-Pacific partners.”
Who is the largest chip maker in the world?
Taiwan Semiconductor Manufacturing Company (TSMC) is the largest contract chipmaker in the world.
What is the number 1 chip company? TSMC, short for Taiwan Semiconductor Manufacturing Company, is far and away in the chip manufacturing world.
Who is the biggest chip maker in the US?
1. Intel Corporation (Leading Semiconductor Company in USA) Intel is the world leader in silicon innovation that creates innovative technologies and supports global initiatives. Their main Semiconductor device is high resolution.
Who are the 3 chip manufacturers?
By 2021, only three companies can produce the highest quality semiconductors: TSMC of Taiwan, Samsung of South Korea, and Intel of the United States.
