By squeezing the industry’s natural choke points, the Biden administration aims to block China from the future of chip technology. The effects will go far beyond curtailing Chinese military advances, threatening the country’s economic growth and scientific leadership as well. “We said there are key technical areas in which China should not advance,” says Emily Kilcrease, a senior fellow at the Center for a New American Security and a former US trade official. “And those happen to be the areas that will power future economic growth and development.” Today, scientific advances are often made by running simulations and analyzing huge amounts of data, rather than through trial-and-error experiments. Simulations are used to discover new life-saving medicines, to model the future of climate change and to investigate the behavior of colliding galaxies – as well as the physics of hypersonic missiles and nuclear explosions.

“The person with the best supercomputer can do the best science,” Jack Dongarra, founding director of the Innovation Computing Laboratory at the University of Tennessee, told me. Dongarra runs a program called the TOP500, which offers a biennial ranking of the fastest supercomputers in the world. As of June, China claims 134 points, compared to 150 for the United States. But the picture is incomplete: Around 2020, China’s offers fell in a way that suggested to Dongarra a desire to avoid attracting unwanted attention. Rumors of new supercomputers trickle out in scientific papers and research announcements, leaving observers guessing about the true state of the competition — and the size of China’s supposed lead. “It’s striking because in 2001 China had no computers on the list,” Dongarra says. “Now they’ve grown to the point where they’re in control of it.”

Yet beneath China’s strength lies a crucial vulnerability: Almost all the chips that power the country’s most advanced projects and institutions are inescapably tied to American technology. “The whole industry can only run on American inputs,” says Miller. “In every facility that is remotely close to the cutting edge, there are American tools, American design software and American intellectual property throughout the process.” Despite decades of effort by the Chinese government, and tens of billions of dollars spent on “indigenous innovation”, the problem remains acute. In 2020, China’s domestic chip producers supplied only 15.9 percent of the country’s overall demand. As recently as April, China spent more money importing semiconductors than oil.

America fully captured its power over the global semiconductor market in 2019, when the Trump administration added Huawei, a major Chinese telecommunications manufacturer, to the entity list. Although the listing was ostensibly a punishment for a criminal violation—Huawei was caught selling sanctioned materials to Iran—the strategic benefits became immediately apparent. Without access to American semiconductors, software and other essential supplies, Huawei, the world’s largest maker of telecommunications equipment, has been left struggling to survive. “The Huawei sanctions immediately pulled back the curtain,” says Matt Sheehan, a fellow at the Carnegie Endowment for International Peace who studies China’s technology ecosystem. “Chinese tech giants run on chips made in the U.S. or with deep U.S. components.”

Export control law has long been seen as a dusty, arcane backwater, far removed from the actual exercise of American power. But after Huawei, the US discovered that its supremacy in the semiconductor supply chain was a rich source of untapped leverage. Three companies, all located in the United States, dominate the market for chip design software, which is used to arrange the billions of transistors that fit on a new chip. The market for advanced chip manufacturing tools is similarly concentrated, with a handful of companies able to claim effective monopolies over essential machines or processes — and nearly all of these companies are American or dependent on American components. At every step, the supply chain goes through the United States, US treaty allies or Taiwan, all of them operating in a US-dominated ecosystem. “We hit it off,” Sheehan says. “We started using these weapons before we really knew like use them.”

By admin

Leave a Reply

Your email address will not be published. Required fields are marked *