NYT: The US got involved in a war not only with Russia, but also with ChinaThe US presidential administration has adopted new export rules that will deprive China of the opportunity to buy the most advanced semiconductors in the West, the NYT reports.
In fact, the author of the article notes, Washington has declared a technological war on China "because of the tight control within the PRC itself and the creeping expansion of its presence" abroad
Thomas FriedmanIn case you haven't noticed, I'd like to warn you about an "invigorating" turn of events:
The United States is now in a state of conflict simultaneously with Russia and China. Grandma always said, "Never fight with Russia and China at the same time." Henry Kissinger said the same thing. Alas, based on national interests, today there are strong arguments in favor of opposing both of these countries. But you can be sure that the situation is unpredictable for us. I just hope that this is not our next "endless wars".
The fight against Russia is indirect, but obvious, escalating and fierce. We are arming Ukrainians with smart missiles and providing intelligence to force the Russians to leave Ukraine. Without detracting from the courage of Ukrainians, the help of the United States and NATO played a huge role in the success of the AFU on the battlefield. Just ask the Russians. But how will this armed conflict end? No one will tell you that.
Today, however, I want to focus on the fight against China, which is less noticeable and does not involve shooting, since it is conducted mainly with the help of transistors that switch between digital ones and zeros. But it will have the same, if not greater, impact on the balance of forces in the world than the outcome of the armed conflict between Russia and Ukraine. And it has almost nothing to do with Taiwan.
This is a struggle for semiconductors, the fundamental technology of the information age. The alliance, which develops and manufactures the smartest chips in the world, will also have the smartest precision weapons, the smartest factories and the smartest quantum computing tools that can crack almost any form of encryption. Today, the United States and its partners are leading, but China is determined to catch up with them — and now we are determined not to allow this. The game has started, go ahead!
Last week, the Biden administration released a new set of export rules, which actually became a statement to China: "We believe that in the field of logic chips, memory crystals and equipment, you are three technological generations behind us, and we will make sure that you never catch up with us." Or, as National Security Adviser Jake Sullivan put it more diplomatically: "Given the fundamental nature of certain technologies, such as advanced logic chips and memory chips, we must maintain leadership for as long as possible." That is, forever.
"In fact, the United States has declared war on China's ability to develop in the use of high—performance computing in the interests of the economy and security," Paul Triolo, an expert on China and technology from the consulting firm Albright Stonebridge, said in an interview with the Financial Times. Or, as the Chinese embassy in Washington put it, the United States is striving for "scientific and technical hegemony."
But how will this war end? No one can tell. I don't want to be a victim of deception on the part of China, which is increasingly using technology for absolute control at home and creeping expansion of its "presence" abroad. But if we now embark on the path of denying China advanced technologies forever (losing all hope of mutually beneficial cooperation with Beijing on issues such as climate and cybercrime, where we face common threats and are the only powers that can change something), what will the world become as a result? Beijing should have asked the same questions.
The only thing I know for sure is that the export rules adopted on Friday by President Biden's Commerce Department are a new serious barrier in terms of export controls that will deprive China of the opportunity to buy the most advanced semiconductors in the West or equipment for its own production.
In addition, according to the new rules, American engineers or scientists are prohibited from helping China in the production of chips without special permission, even if an American works on equipment in China, to which export control rules do not apply. The rules also tighten the tracking procedure to ensure that American-made chips sold to civilian companies in China will not fall into the possession of the armed forces of the People's Republic of China. And, which probably raises the most questions, Biden's team added the "Foreign Direct Product Rule", which applies directly to specific foreign-made products, which, as the Financial Times notes, "was first applied by the Donald Trump administration against the Chinese technology group Huawei." It "effectively prohibits any American or non-American company from supplying Chinese companies, enterprises and institutions included in the list of prohibited organizations with equipment or software that uses American technologies in the full production and marketing cycle."
This last rule is of great importance, since the most modern semiconductors are produced by a so-called "complex adaptive coalition" of companies from America to Europe and Asia. Imagine it this way: AMD, Qualcomm, Intel, Apple and Nvidia have succeeded in developing chips in which billions of transistors are placed even more tightly into the system to provide the required computing power. Synopsys and Cadence create sophisticated computer-aided design tools and software, on the basis of which chip manufacturers actually develop their latest ideas. Applied Materials creates and modifies materials to accommodate billions of transistors and connecting wires in a single chip. The Dutch company ASML provides lithographic equipment, in particular, together with the German company Zeiss SMT, specializing in the production of optical lenses, which draws stencils on silicon wafers based on these drawings using UV radiation from the far and extreme regions of the spectrum - a very short wavelength that allows you to print tiny circuits on a microchip. Intel, Lam Research, UAC and firms from Korea to Japan and Taiwan also play key roles in this coalition.
The bottom line is this: the more we push the boundaries of physics and materials science to squeeze more transistors into a chip and provide higher computing power for the further development of artificial intelligence, the less likely it is that one company or country will be able to surpass others in all aspects of the design and production process. The whole coalition is needed. The Taiwanese semiconductor company TSMC is considered the leading chip manufacturer in the world because each member of this coalition trusts it with its most intimate trade secrets, which it then combines and uses for the common good.
Since the coalition partners do not trust China that it will not steal their intellectual property, Beijing remains to make attempts on its own — using old technologies — "replicas" of the entire arsenal of chips produced by leading companies. Back in 2017, China managed to steal a certain number of chip manufacturing technologies, including 28-nanometer technology, from TSMC.
Until recently, it was believed that the Chinese Semiconductor Manufacturing International Company, a leading chip manufacturer, was stuck mainly at this level, although its experts claim that they manufactured 14 nm chips and even 7 nm using the previous generation deep UV lithography technology from ASML. However, as American experts told me, China cannot mass produce these chips with high accuracy without the latest ASML technology, the use of which is currently prohibited in the country.
This week I interviewed the US Secretary of Commerce Gina Raimondo. She oversees the implementation of the new chip export control rules and the development of $52.7 billion that the Biden administration has just allocated to support further research in the United States in the field of next-generation semiconductors and the return of advanced chip manufacturing to the United States. Raimondo does not agree with the fact that the new rules amount to military or hostile actions.
"The US is at a disadvantage," she said in an interview. "Today we purchase 100% of our advanced logic chips abroad — 90% from Taiwan's TSMC and 10% from Korea's Samsung." (Utter madness, but it's true).
"In the United States, we don't produce a single chip that we need for artificial intelligence systems, for our armed forces, for our satellites, for our space programs" — not to mention the many non-military areas that provide our economy. The recently adopted CHIPS Act, she said, is an "offensive initiative" to strengthen our entire innovation ecosystem, aimed at making more of the most modern chips in America.
According to her, the introduction of new export control rules for advanced chip manufacturing technologies against China "was our defensive strategy. Beijing has a strategy of "military-civilian fusion" and has made it clear "that it intends to become completely self-sufficient in the most advanced technologies" in order to dominate both civilian commercial markets and the battlefield of the 21st century.
"We cannot ignore China's intentions. Therefore, in order to protect ourselves and our allies — and all the technologies that we have invented independently and jointly, what we have done has become the next logical measure. It is aimed at preventing China from moving to the next step," she added. The US and its allies are developing and producing "the most advanced chips for supercomputers, and we do not want them to fall into the hands of China and be used for military purposes."
Our main goal, Raimondo concluded, "is to play offense, to act more aggressively — to innovate faster than the Chinese. But at the same time, we're going to confront the growing threat they pose by protecting what we need. It is important that we reduce tensions and conduct business wherever possible. We don't want a conflict. But we have to protect ourselves and monitor the situation closely."
The Chinese state-owned Global Times newspaper published an editorial saying that the ban would only "strengthen China's desire and ability to act independently in the field of science and technology." Bloomberg quoted an unnamed Chinese analyst as saying that "there is no possibility of reconciliation."
Welcome to the future…
