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The Biden administration announced a trade investigation into Chinese legacy semiconductors, which usually refer to 28 nanometer or higher chips, to protect America’s chip-making sector. The Office of the US Trade Representative will launch a Section 301 investigation to examine the People’s Republic of China (PRC)’s targeting of foundational semiconductors or mature node chips for dominance and the impact on the US economy, according to a released by the White House on Monday (December 23). The USTR probe will Chinese semiconductors incorporated as components into downstream products for critical industries like defense, automotive, medical devices, aerospace, telecommunications, and power generation and the electrical grid.
It will also initially assess whether the impact of China’s acts, policies and practices on the production of silicon carbide substrates (or other wafers used as inputs into semiconductor fabrication) contributes to any unreasonableness or discrimination or burden or restriction on US commerce. “This investigation underscores the Biden-Harris Administration’s commitment to standing up for American workers and businesses, increasing the resilience of critical supply chains, and supporting the unparalleled investment being made in this industry,” said US Trade Representative Katherine Tai. The New York Times on December 16 that the Biden administration was preparing to probe China’s legacy chips.
The report said it may take at least six months to finish the probe, so it will be for the incoming Trump administration to decide what actions to take. The Chinese Ministry of Commerce (MoC) on Monday the USTR’s coming legacy chip probe. “The US side has provided huge subsidies to its chip industry through the Chip and Science Act,” a MoC spokesperson said.
“While its companies account for nearly half of the global chip market, the US accuses China of having so-called non-market practices and exaggerates the threat of the Chinese chip sector.” The spokesperson said Washington should respect the fact that China’s imports of American chips are much greater than the United States’ imports of Chinese chips. “The Biden administration wants to create a fine net to contain China’s chip sector,” Lai Jiaqi, a columnist at Guancha.
cn, in a recent article. “In the past, the US government’s curbs against China’s chip industry were focusing on the ban of the shipment of advanced US chips,” Lai said. “As the US keeps tightening its rules, China is gradually increasing its investments on the manufacturing of its own mature chips.
” However, citing an April report by the Center for Strategic and International Studies (CSIS), a Washington-based think tank, the writer said it’s unlikely that an oversupply of Chinese mature chips will happen in the coming two to three years due to various reasons. Overcapacity concerns According to the , the three reasons why overcapacity concerns are either exaggerated or misunderstood as emanating uniquely from China: Apart from investigating Chinese , the White House said Monday that it will enhance federal supply chain security by prohibiting executive federal agencies from procuring or obtaining products and services that include chips from certain Chinese fabs and other entities of concern. It also said it will work with its partners around the world to strengthen cooperation in semiconductor supply chains and address shared concerns about China’s reputed unfair practices.
CHIPS for America Ahead of Republican President-elect Donald Trump’s inauguration on January 20, the Biden administration has launched this month a series of to suppress China’s chip sector. On December 2, the Commerce Department’s Bureau of Industry and Security (BIS) unveiled a third package of chip export rules against China, following two previous rounds in October 2021 and 2022. The BIS also added 140 Chinese chip makers and suppliers to its “Entity List” and imposed new export controls on 24 types of semiconductor manufacturing equipment, three types of software tools for developing or producing semiconductors and high-bandwidth memory (HBM) chips.
On December 10, the United States Office of Management and Budget (OMB) a Request for Information (RFI) to gauge the best ways to incentivize government contractors, especially of commercial IT products and services, to scale up their use of domestically manufactured chips. On December 19, the White House its first-ever Quadrennial Supply Chain Review to provide an in-depth assessment of the United States’ critical supply chains, actions taken over the last four years to make each supply chain more resilient, and necessary steps to increase US resilience in the future. US President Biden has also increased the pace of granting subsidies to qualified chipmakers to build foundries in the US.
The government said the CHIPS for America program has so far awarded over US$26 billion in incentives to advance domestic production in semiconductors and their supply chains. It said this made America home to all five of the world’s leading-edge logic and memory providers, while no other economy has more than two. ’A fool’s errand’ After the US unveiled new export controls to ban shipping high-end US chips to China on December 2, four Chinese industry groups on December 3 called on their members not to buy American legacy semiconductors due to “safety” concerns.
The industry groups include the Internet Society of China, the China Semiconductor Industry Association, the China Association of Automobile Manufacturers and the China Association of Communications Enterprises. Concluding the Biden administration’s four-year efforts to boost the US chip sector, US Commerce Secretary told the on December 21 that “trying to hold China back is a fool’s errand.” She said chip export controls were only “speed bumps” for China and could not stop the country’s progress in building its own semiconductor capabilities.
She said the only way for the US to win the chip war is to out-innovate China and stay ahead of it. Liu Lanxun, a Hubei-based military columnist, that Raimondo finally admitted at the end of her term that the US chip ban against China is a waste of time. But he said the US may not necessarily in the end as China is also heavily in its chip industry.
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