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41. Convince and Coerce: U.S. Interference in Technology Exchanges Between its Allies and China

Author:
Mathilde Velliet
Publication Date:
02-2022
Content Type:
Special Report
Institution:
Institut français des relations internationales (IFRI)
Abstract:
The tough-on-China policy adopted by the Trump and Biden administrations has – and will increasingly have – important consequences for Washington’s allies, both on their infrastructure choices (5G, submarine cables...) and on their technological exchanges with China. Indeed, the U.S. objective of slowing down China’s technological development has been translated into multiple policies, primarily targeting China but also – directly or indirectly – U.S. partners. On the one hand, Washington deploys a range of coercive and incentive tools to prevent its allies from adopting certain technologies, supplied by Chinese companies and « untrusted » by American authorities (in terms of cyber, data or infrastructure security). Case studies of U.S. efforts against the deployment of Huawei’s 5G or Hengtong Group’s undersea cables reveal a similar strategy, combining direct diplomatic pressure, a threat awareness campaign, and financial incentives. On the other hand, in line with the United States’ historical use of the extraterritoriality of its law and its position as an economic superpower to influence its allies’ decisions, Washington seeks to restrict transfers of critical technologies from allies to China. As the main manufacturers (along with the United States) of these technologies, American allies are increasingly constrained by these legal and diplomatic restrictions, which target one of their main trading partners and tend to extend beyond strictly military or cutting-edge technologies. For example, in order to limit sales of semiconductor manufacturing equipment, U.S. authorities are combining changes to the American export control regime with diplomatic efforts (bilaterally and multilaterally) to persuade allies to align their own export policies with those of the United States. While the Biden administration appears to be placing greater emphasis on cooperative and incentive approaches, it seems likely that the multidimensional U.S. strategy serving these two objectives will continue, and even be strengthened. Among allies (and especially in Europe), this trend has raised awareness of the security challenges posed by certain Chinese suppliers, but also of the risks associated with the growing coercive practices of the great powers.
Topic:
Science and Technology, Internet, 5G, Semiconductors, and Submarine Cable
Political Geography:
Japan, China, Europe, Asia, North America, and United States of America

42. Fall 2022 edition of Contemporary Eurasia

Author:
Levon Hovsepyan
Publication Date:
07-2022
Content Type:
Journal Article
Journal:
Contemporary Eurasia
Institution:
Institute of Oriental Studies, National Academy of Sciences of the Republic of Armenia
Abstract:
CONTENTS LEVON HOVSEPYAN, TATEVIK MANUKYAN TURKISH DOMESTIC DETERMINANTS AND ANKARA’S MILITARY OPERATIONS IN SYRIA: KURDISH THREAT AND EXPANSIONIST AMBITIONS.......................................................................................................... 5 NELLI MINASYAN TURKISH INITIATIVES IN THE DIRECTION OF TURKIC INTEGRATION: PREREQUISITES AND TENDENCIES............................................................. 22 ARAKS PASHAYAN, NAZELI NAVASARDYAN SOCIO-POLITICAL PERCEPTION OF SHĪʿA ISLAM IN AZERBAIJAN: THE INFLUENCE OF EXTERNAL FACTORS ................................................ 40 GUIHUA NI TECHNOLOGY DIFFUSION AND POWER TRANSITION: THE CASE OF THE SEMICONDUCTOR INDUSTRY IN EAST ASIA ................................... 55 ARAM GASPARYAN THE “CIVIL CONCORD”: ATTEMPT FOR PEACE IN ALGERIA ................ 76
Topic:
Foreign Policy, Islam, Science and Technology, Syrian War, Kurds, Integration, Regional Power, Semiconductors, and Shiism
Political Geography:
Central Asia, Turkey, Middle East, East Asia, Algeria, Azerbaijan, and Syria

43. Labs over Fabs: How the U.S. Should Invest in the Future of Semiconductors

Author:
Chris Miller, Jordan Schneider, and Danny Crichton
Publication Date:
03-2021
Content Type:
Special Report
Institution:
Foreign Policy Research Institute (FPRI)
Abstract:
The U.S. semiconductor industry faces an existential competitive threat. China’s efforts to catch up and eventually overtake the U.S. in semiconductor technology is not only an economic challenge—it is also a security threat. The Trump administration’s decision to pressure Huawei by cutting off its access to critical semiconductor technologies has only intensified China’s commitment to developing its own ability to design and manufacture computer chips without reliance on foreigners. China has spent billions of dollars in state subsidies, and plans to spend billions more in the coming years. At risk is not just the U.S. industrial base, but also the complex supply chains that link U.S. firms to customers and suppliers in South Korea, Taiwan, Japan, and several European countries. On February 24, 2021, President Biden ordered a 100-day review aimed at “securing America’s critical supply chains.” The executive order focused on the semiconductor industry, declaring that “over the years we have underinvested in production—hurting our innovative edge—while other countries have learned from our example and increased their investments in the industry.” While production certainly has its place, it would be dangerous for the U.S. to focus solely on the fabrication of semiconductors at the expense of other parts of the chip production process—including design, software, and production machinery—where the U.S. is currently stronger. There is a case to be made for supporting the construction of manufacturing facilities (“fabs”) for certain types of specialized chips, such as those needed in the defense sector. But reshoring most or all production is not a realistic goal. Moreover, the tens of billions of dollars that such a policy would cost are better spent elsewhere. Beyond that, the U.S. should focus less on supporting production of today’s technologies, which given the pace of innovation will soon be out of date. Instead, scarce resources should be devoted to shoring up the broader semiconductor ecosystem on which American innovation depends. In the past, the government has played a major role in investing in research that is not yet commercially viable, something it should be doing more of today. It should build talent pipelines from high schools to universities to corporations and startups, ensuring an ample supply of semiconductor engineers. And the U.S. should see open-source chip architectures such as RISC-V not as a threat to existing intellectual property, but as a technology that could unlock a new wave of semiconductor innovation—something that the U.S. would be well placed to lead.
Topic:
Science and Technology, Investment, and Semiconductors
Political Geography:
North America and United States of America

44. A new direction for the European Union’s half-hearted semiconductor strategy

Author:
Niclas Poitiers and Pauline Weil
Publication Date:
07-2021
Content Type:
Policy Brief
Institution:
Bruegel
Abstract:
A basic component in electronic devices, semiconductors are essential to the production of many products, from smartphones to cars. Securing reliable supplies of semiconductors to safeguard the production lines of a range of industries has thus become an important policy goal, especially in the context of an increasingly confrontational international environment in which high-technology leadership is also associated with military power and geopolitical reach. The semiconductor sector is highly concentrated, capital- and R&D-intensive, and particularly exposed to bottlenecks and political risks. High-end chip fabrication is centred in Asia, dominated by the duopoly of Taiwan’s TSMC and South Korea’s Samsung. In other parts of the supply chain, companies in the United States and Europe hold relative monopolies that have been leveraged for trade sanctions. The United States has taken steps to block the supply of chips and components to emerging tech giants in China, and to contain China’s ambitions of building its own cutting-edge chip production capacities. Heavy United states and Chinese investment poses a challenge to the European Union, which in response has set the goal of increasing European production beyond domestic demand. To increase its presence in this strategic and thriving sector, the EU needs a more targeted strategy that builds on its existing strengths while accommodating its relatively low domestic needs. Instead of investing public funds in a subsidy war over fabrication capacity, the EU should focus on inputs and chip design. However, no economy can hope to fully achieve independence in the sector and ensuring sustainable supply through diplomatic means should therefore also be a priority. Lastly, Europe’s small role in global semiconductor production is symptomatic of shortcomings in the European environment for high-tech innovation. These shortcomings should be addressed.
Topic:
Science and Technology, European Union, Economy, and Semiconductors
Political Geography:
China, Europe, and United States of America