It occurs to me the real objective to stirring up a China War over Taiwan is actually about a War against Taiwans Chip Industry so as to bring it to US much like the UKRAINE-NATO War seems designed in part to bring Europes Industry to set up shop in the US due to Energy Instability caused by Russian Sanctions
Let me put this simply. The US is silently at War on Taiwans supremacy in Chip manufacturing. They are stirring up problems with China like they did with Russia over Ukraine to gain political support for taking over Taiwans Chip dominance. Taiwan is allowing them to do so, perhaps reluctantly.
Taiwan will then go from being a strategic partner to a strategic competitor. Once the Chips the world needs are being made in US and with US based corporate ownership over the intellectual property, Taiwan becomes disposable
The US is a 1 trick pony when it comes to foreign relations. Use, Abuse then Dispose. Taiwan has already experienced one cycle from 1950-1979. The second cycle began in 2014 with the Sun Flower Revolution when President Ma was opening up too much to China (same thing happened in Ukraine although that was a more obvious coup). I expect this cycle will be much shorter than the first one
It starts with the CHIP ACT a US bill authorizing $50 billion for semiconductor research and manufacturing in America.
🇺🇸"🇹🇼" Translation: "Hello Taiwan, Thank you for irrationally throwing yourself at the rest of China as our belligerent proxy, our "Ukraine" of East Asia...
We are fully committed to undermining your chip industry making it that much easier for us to feed you fully (feet first) into the wood chipper of proxy war."
https://t.me/brianlovethailand/881
Yesterday
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, plunged a record 8.3 percent, while Samsung Electronics Co and Tokyo Electron Ltd also declined.
[Notice the drop off following Pelosis visit end of July and passing of the CHIP Act although the stocks been in decline since the Ukraine War and Russian Sanctions and US string arming TSMC into building a plant in the US which is scheduled to open in 2024. If you think China is good a stealing trade secrets wait till you see what the US can do in their own backyard]
The selloff spread to the foreign-exchange market as investors tally up the damage from the sweeping curbs the US is imposing on companies that conduct technology business with China.
The measures imposed by the administration of US President Joe Biden erect barriers of entry to China’s market by limiting the ability of US firms to sell equipment and tech to their Chinese counterparts. There are concerns that the restrictions could spread if Washington widens the initiative to include other countries, while questions also remain over the scope and final impact of the moves.
“It is difficult to call a bottom on the performance of the chip sector,” Global CIO Office chief executive officer Gary Dugan said.
“The big story is that the West is becoming profoundly more concerned about security around any form of technology. We see no reason to re-enter the sector for the moment despite the profound poor performance.”
https://www.taipeitimes.com/News/biz/archives/2022/10/12/2003786834
Needless to say this will hamper TSMC to continue to maintain its dominance as doing so requires lots of incoming investments which has been possible during its growth phase
A few days earlier a story broke that alleged the U.S. will evacuate Taiwanese engineers working in the semiconductor industry, in the event of a full-on Chinese invasion.
A
B
Ah ha, maybe a China invasion or at least a threat of an invasion plays into the US hands to pilfer Taiwans Chip Industry.
Wake up Taiwan. Not saying you need to jump into Chinas arms but you need to be smarter than this. You used to be good at playing both sides. Being Americas bitch will not be much more pleasant than being the CCP’s bitch, at least not for the non-Elites on the Island. The rich folks can run off to California or Hawaii at the first sign of blockade or invasion along with the Engineers and Managers in the Chip Industry. You will be Left Behind.
For more information on the Chips Act read on:
House Speaker Nancy Pelosi (D-CA) met with several of Taiwan's chip industry leaders during her visit to Taipei to promote closer commercial ties between the two countries following the House's passage of legislation funding new chip production capabilities in the United States.
Pelosi met with Taiwan Semiconductor Manufacturing Co. Chairman Mark Liu during the visit, according to senior lawmakers in Taiwan. The pair discussed the CHIPS Act, which the House passed last week and sent to President Joe Biden to sign into law.
The bill would provide hundreds of billions of dollars to fund U.S. innovation. The legislation includes a $52 billion subsidy for chipmakers like Intel in hopes of weaning off a total reliance on Taiwan for semiconductors.
The House Speaker praised the passage of CHIPS as "a great opportunity for U.S.-Taiwan economic cooperation" during a lunch with Taiwanese President Tsai Ing-Wen.
"We just passed the CHIPS and Science Act. That is something that opens the door for us to have better economic exchanges. ... The entrepreneur spirit, the brain power, and the intellectual resources that exist in Taiwan — and the success of the tech industry here — has really been a model, and we want to increase our relationship," Pelosi added.
Pelosi met with several other industry officials during her time in Taiwan, including a visit with TSMC founder Morris Chang during a lunch with Taiwanese President Tsai Ing-Wen.
Taiwan has maintained control of the semiconductor markets for several years. The country currently controls 48% of the world's semiconductor foundries and 61% of the ability to build the more advanced 16nm chips, according to data released by TrendForce.
However, the country's leading semiconductor foundry, TSMC, has struggled to keep up with demand, leading to the current shortage of semiconductors across the world.
Its problems have also created security concerns. U.S. officials have been concerned about the national security threats that a China-controlled semiconductor market would have on future military operations. This, in part, led to legislators such as Senate Majority Leader Chuck Schumer (D-NY) seeking to pass the CHIPS Act, which would help build additional foundries in the United States and help the country wean off of total reliance on China and Taiwan.
TSMC finished constructing a $12 billion plant in Arizona to expand its efforts outside of Taiwan. The plant is expected to begin operations in 2024.
The House voted 243-187 in favor of the legislation on July 28, a vote complicated by GOP anger over Senate Democrats unveiling a surprise agreement on significant climate and healthcare legislation meant to pass without Republican votes.
Senate Majority Leader Mitch McConnell (R-KY) had said that Republicans would block the semiconductor legislation if Democrats threatened to pass the partisan climate and healthcare spending bill.
https://www.washingtonexaminer.com/policy/technology/pelosi-semiconductor-leaders-taiwan-chips-act
[I don’t know if Taiwan has thought this through. By transferring some of TSMC production and know how to the US and helping Pelosi push a bill that aids US companies like Intel and others to compete with TSMC, then Taiwans value to US will diminish. Indeed, misfortune to TSMC on Taiwan due to War will enhance the value of US based Chip Makers
And beware that Trade Agreement. We tend to use such Agreements to weaken countries sovereignty and usurp the Democratic protections of its citizens in favor of US Corporations]
Last year, TSMC announced plans to pump $100bn into expanding the manufacturing capacity at its factories over three years in response to the chip shortage. This includes a facility it is building in the US state of Arizona.
Semiconductors are used in everything from computer and cars to coffee machines, and a global shortage has meant that many of these products are in short supply. Some US tech executives have argued a steady domestic supply of chips are crucial to advances in technology.
However, the CHIPS and Science Act restricts companies that get US federal funding from increasing advanced chip production in China, a move that impacts big chip players such as Intel and TSMC and further escalates tensions between two of the world’s most powerful countries.
Bloomberg reported that the condition in the act means that TSMC, which provides customers such as Apple with its tech, won’t be able to substantially upgrade or expand its existing operations in China and may lose out on growth opportunities in the world’s biggest chip market.
The move has also prompted leading Korean chipmakers Samsung and SK Hynix to reconsider their investments in China, according to sources who spoke to the Financial Times. “If China is unhappy, they will have to take it up with the US,” a senior Korean official told the outlet.
In 2020, TSMC responded to pressure from US government to cut ties with Chinese company Huawei, which at the time was one of its most important customers after Apple.
https://www.siliconrepublic.com/machines/why-is-nancy-pelosi-visiting-taiwan-chips-act-tsmc
[I am all for reducing our dependence on China. I am also aware that doing so makes War with China more attractive. Its a bit of a double edge sword that Taiwan who would be caught in the middle should consider]
CHIPS and Science Act as an example of a seemingly well-intended policy that will produce bad outcomes. (CHIPS is an acronym for Creating Helpful Incentives to Produce Semiconductors.)
The bill passed the Senate by a vote of 64-33 on July 27; the House passed it the next day, 243-187. The legislation was set to be signed into law Tuesday by President Joe Biden.
The measure aims to boost American semiconductor chip manufacturers and combat the threat China poses to America’s national security. Roberts said he views the Chinese Communist Party as a greater threat than the former Soviet Union was.
But the CHIPS and Science Act, Heritage’s president argued, simply would line the pockets of corporations that are its beneficiaries.
“These chip companies, making tens of billions of dollars, don’t need our money,” Roberts said.
As Roberts noted in a July 22 statement:
The answer to the [Chinese Communist Party’s] malevolent ambitions is not spending billions of dollars to help Fortune 500 companies, with no guarantee those dollars won’t end up supporting these companies’ business operations in China.
Additionally, the act’s [$280] billion price tag will contribute to record inflation and increase the already historic cost of living for working and middle-class Americans.
https://www.dailysignal.com/2022/08/02/chips-act-an-example-of-misguided-public-policy-heritage-foundation-president-says/
The U.S. share of global semiconductor manufacturing capacity has decreased from 37% in 1990 to 12% today, largely because other governments have offered manufacturing incentives and invested in research to strengthen domestic chipmaking capabilities, according to a state of the industry report by the Semiconductor Industry Association.
Now China accounts for 24% of the world's semiconductor production, followed by Taiwan at 21%, South Korea at 19% and Japan at 13%, the report said.
With the CHIPS Act, the administration hopes to bring as much semiconductor manufacturing to the U.S. as practically possible, said Bonnie Glick, director of the Krach Institute for Tech Diplomacy at Purdue University.
"And what can't be reasonably onshore, either because it's cost prohibitive or other allied countries simply do it better, we can ally-shore manufacturing and support that," she told VOA.
The two allies the administration has leveraged are South Korea and Japan, both of which Biden visited in May. In Seoul, he toured a Samsung computer chip factory that is the model for a $17 billion facility that the South Korean technology giant is setting up in the U.S. state of Texas.
Last week, the U.S. and Japan launched a new joint international semiconductor research hub under a "bilateral chip technology partnership" to bolster manufacturing for 2-nanometer chips as early as 2025.
Washington has also persuaded Taiwan Semiconductor Manufacturing Ltd. (TSMC) to open a U.S. foundry to produce advanced semiconductors. The $12 billion facility in the state of Arizona was completed last month and is scheduled to start production of 5 nm chips by 2024. TMSC also has plants in China.
"We're back in the game," Biden said Tuesday. "Remember, we invented these chips, we modernized these chips, we made them work, and there's a lot more we can get done."
The CHIPS Act has laid out a clear strategy for Washington, said Volker Sorger, Professor at the George Washington University and co-founder of Optelligence Company.
"Gain autonomy and eliminate political dependencies on these global supply chain values," Sorger told VOA.
That strategy puts the U.S. on a collision course with China, which also aims to be the global leader in semiconductors.
In 2015, Beijing launched the Made in China 2025 project, which aimed to increase chip production from less than 10% of global demand at the time to 40% in 2020 and 70% in 2025.
The Made in China 2025 program and the People's Liberation Army’s goal of military-civil fusion make it "overtly clear that Beijing is seeking to dominate global technology and supply chains through anti-competitive trade practices and infiltration of dual-use technology research," Glick said.
The U.S. government has been pushing for stricter export regulations to China by prohibiting export of equipment needed for manufacturing chips at 14 nm and below. "That would mark an escalation from the previous ban covering 10 nm and below," Glick added.
Taiwan's strategic importance
Taiwan — a self-governed island that Beijing claims to be its breakaway province — lies at the heart of the increasingly tense U.S.-China rivalry.
Taipei has dominated manufacture of the world's most high-tech chips, accounting for 92% of the global production of 10 nm or smaller semiconductors, essentially creating what some observers have characterized as a "silicon shield" that ensures American support in the event of a Chinese attack, as well as a deterrence to such a move.
A military conflict over Taiwan could disrupt TMSC's semiconductor production and have disastrous effects on global manufacturing.
U.S.-China tensions are already spooking technology investors. TSMC shares fell nearly 3% on Tuesday as U.S. House of Representatives Speaker Nancy Pelosi landed in Taipei in a visit she said demonstrated American solidarity with the Taiwanese people.
Beijing has condemned the visit, the first by a U.S. House speaker in 25 years, as a threat to peace and stability in the Taiwan Strait.
Rare earths
The CHIPS Act does not include provisions to secure supply chains of rare earths — and other critical minerals used in semiconductors and other high-tech elements — to reduce the nation's dependence on China, a major producer of these elements.
"I don't know that we have developed a coherent strategy on accessing both rare and nonrare elements," Glick said.
Last June, following Biden's executive order to improve supply chains, the administration released a report concluding that the U.S. was overly reliant on China for critical minerals. Currently, China controls 87% of the global permanent magnet market, 55% of rare earths mining capacity and 85% of rare earths refining.
Earlier this year, the administration announced actions it said would bolster the supply chain of these elements, including a contract for U.S. company MP Materials to process heavy rare earth elements at its California production site — the first processing and separation facility of its kind in the nation.
https://www.voanews.com/a/biden-celebrates-semiconductor-legislation-to-boost-us-competitiveness-against-china/6684892.html