December 5, 2021

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Semiconductors: Why China and the United States did not start a war on Taiwan

Semiconductors: Why China and the United States did not start a war on Taiwan

The feud between China and Taiwan has been escalating in recent weeks. There are posts about it An instant test On. The Communist Party of China (CCP) sees “reunification” with Taiwan – an autonomous democracy that has never ruled – as the main unresolved issue on the path to “great rejuvenation.” Taiwan did not want to hear about it. If so, it is a regional conflict that Taiwan produces 80 percent of the world’s semiconductors. Taiwan is the DSMC world champion in that area. Apart from China, US manufacturers still rely heavily on TSMC to manufacture their cars, computers, smartphones and more.

Why is this important?

Both the United States and China depend on Taiwan for their semiconductors. But contrary to popular belief, the United States does not see the Taiwan issue as a political issue. The Trump administration did not budge when the Chinese captured Hong Kong and paralyzed democracy there. If the Chinese invade Taiwan tomorrow, the chances of American soldiers “dying for Taiwan” are slim. Meanwhile the semiconductor seems to be working on solving the problem.

China and the United States: Couples who can no longer broadcast to each other, but have divorced, have more children

The most likely scenario is this: China will wait until the United States becomes self-sufficient in semiconductors, just as the United States turned to oil. Once that happens, China will be able to annex Taiwan without a single firefight.

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But until then how can the semiconductor problem be solved? According to Ian Bremer, founder of the Eurasia Group, a political risk research and consulting firm, China and the United States “have more children than a couple who can not care for each other, but are divorced.” If there is an armed conflict to the extent that the two countries are dependent on each other, both economies will immediately collapse.

According to Bremmer, there will never be a war on semiconductors – as many in the media have suggested. Both countries prefer the current situation over military conflict. Both China and the United States invest billions in the semiconductor sector, but currently rely on TSMC, which exports 80 percent of its production to other parts of the world.

Two final generation semiconductor factories

The United States has now asked TSMC to become the US military’s preferred partner. It will happen Build a factory in Arizona. The United States is willing to subsidize that construction with taxpayer money. If the company is a partner in the U.S. military industrial complex, the United States – in the name of national security – may ban semiconductor exports. It would deepen the situation because the Chinese need those semiconductors. Such a situation would be the perfect opportunity to annex the island to China. This is a problem for Taiwan.

But according to Bremer, that will not happen. DSMC will solve the problem by setting up two factories: one in the United States and one in China. Both factories did not produce semiconductors of the last generation (3 nanometers), but of the last generation (5 nanometers). The current arms race is expanding with technical ambiguity. A scene described Recent Report One Head National Security Commission for Artificial Intelligence (NSCAI).

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According to Bremer, this is far from an ideal solution, but there is no other way than this to avoid a total increase and massive risks for both countries. One that both countries understand well.

(jvdh)