Outside In | US-China tech war: US efforts to control chips industry will put Taiwan at risk

Taiwan’s dominance in advanced chip-making makes it vulnerable. If the US is truly concerned not just for Taiwan’s security but its long-term prosperity, then the effort to contain China’s technological development is foolhardy and likely to backfire

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A wafer sits on display as Taiwanese chip giant TSMC holds a ceremony to start mass production of its most advanced 3-nanometre chips in the southern city of Tainan on December 29. Photo: Reuters

Published: 3:30am, 7 Jan 2023Updated: 5:16am, 7 Jan 2023

As US President Joe Biden plunges into 2023 by doubling down on US efforts to technologically contain China, fresh questions are being raised not only over whether such a strategy can succeed but whether it might inflict equal and catastrophic harm on the US economy, its leading companies, the economies of its friends and the hapless pawn in this saga that is Taiwan.

As Gideon Rachman – normally a loyal incubator of security paranoias about China – asked in the Financial Times earlier this week in a moment of unusual introspection, do we truly want China to fail? The goal, he said, “should not be to prevent China from becoming richer. It is to prevent China’s growing wealth from being used to threaten its neighbours or intimidate its trading partners.”

Hail to that, except that I can count not a small number of countries – including some close US allies – who wish the United States would also use less of its wealth threatening its neighbours or intimidating its trading partners.

The premise underpinning the US tech war is that China is bent on building competitive advantage through its “Made in China 2025” strategy – by fair means or foul – in the newest and most value-adding technologies. In particular, there is a focus on the spectrum of semiconductor industries that have become indispensable not just to almost everything we consume but to US military security and technology leadership.

Worse, and central to the US security community’s focus, is the idea that China is using this strategy to undermine the democracies of the West and pursue aggressive and expansionist military objectives in the western Pacific and further afield.

Security officials are, of course, employed to be paranoid. The diffusion of increasingly powerful microprocessors into everything from smartphones, dishwashers and traffic coordination systems to drones, satellites and rockets has made it next to impossible for them to differentiate simple consumer goods from the dual-use devices that have the potential to undermine US security.

.css-1m2rp1p{color:#34b8b5;}Outside In | US-China tech war: US efforts to control chips industry will put Taiwan at risk

Outside In | US-China tech war: US efforts to control chips industry will put Taiwan at risk