While the administration is against China: US companies are cooperating with China to manufacture chips

by time news

What is the most important product in the world? Beyond the things that are necessary for daily existence – food, clean water – these are probably chips. The modern world is running on chips. They are found in every electronic product: the computer and the smartphone, of course, all our kitchen products, data centers that hold the global Internet avenue, cars, planes, ships, agricultural equipment, machinery in factories, desalination systems (which makes it possible to argue that chips are actually more important than food And water); Any device or machine with minimal sophistication encodes some chip inside them.

A long, several-month shortage of chips is already weighing on the global economy in various ways. Without chips at all, the world as we know it will begin to disintegrate very quickly, and thus a country that holds dominance in the global chip industry has very significant indirect control over the world economy. Therefore, what is happening in China these days is particularly worrying: According to a Wall Street Journal exposure, American companies and their partners in China are significantly increasing their investment in Chinese chip companies, and are actually giving a hand in Beijing’s efforts to steal American leadership in the field. This move, if successful, will in fact give China a suffocating grip on the global economy and could have particularly negative implications for the global balance of power; Further proof that in a capitalist economy there is nothing that capitalists will not do for quick profit.

The investments are made against the background of the ongoing global shortage of chips, and are part of a broader conflict between the US and China over dominance in critical technologies. The Chinese government is investing considerable sums in subsidizing local industry In China in 2020 alone stands at more than 22 thousand – an increase of 200% compared to 2019.

The US administration is trying to delay Chinese progress in the field by restricting exports of software, equipment and other technologies used to manufacture chips, and promoting policies that involve a multi-billion dollar investment in the preservation of American leadership. The White House is also working with legislators that will allow the administration to filter foreign investment of U.S. capital in comparable countries like China and Russia. One should not imagine too much how much the activity from home that contributes to the undermining of these efforts frustrates the relevant government officials.

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