It is against this backdrop that the Biden administration says it wants to “de-risk” its relationship with China — keeping trade essentially open but restricting certain areas that Washington believes could give China the upper hand when it comes to national security or future-defining technology.
Last year, Biden imposed a sweeping set of export controls designed to block China’s access to certain kinds of semiconductor chips made with U.S. technology.
These export controls and other technology restrictions have had implications for companies all over the world and Macronix is no exception. Like other Taiwanese chipmakers, it is barred from selling advanced chips to China, the island’s largest trading partner.
China has criticized the export controls as an abuse of trade measures that is meant to protect U.S. “technological hegemony.” Many industry figures agree Washington’s attempt to control the market is counterproductive.
The U.S. export controls will “delay but not stop China” from achieving technological parity, said Penn at Future Horizons.
“It may take 10 years, but they’ll do it: They have the resources to do it, they have got the scientific know-how, they have got the money, they have got the market, and now they’ve got the need,” he said.
Penn is among the experts deeply critical of Washington’s export controls, calling them counterproductive. And this week the chief financial officer of American tech firm Nvidia, Colette Kress, told an investor conference that introducing new restrictions would result in a “permanent loss of opportunities for the U.S. industry to compete and lead in one of the world’s largest markets.”
The U.S., which produces about 10% of the world’s semiconductor chips and none of the most advanced ones, is also trying to boost domestic manufacturing, offering tax incentives for projects like the $40 billion factory being built in Arizona by the Taiwanese chip giant TSMC.
But building such a complex industry will take time, Wu said. “I would say 10 years,” he added.
Ultimately, he said, the stability of the semiconductor industry — and people’s access to the devices powered by it — depends on the leaders of China, Taiwan and the U.S.
“They have to make the right decision with their wisdom,” Wu said. “That is the solution.”
Richard Engel and Charlotte Gardiner reported from Hsinchu, Taiwan. Jennifer Jett reported from Hong Kong and Alexander Smith reported from London.