Tech war: China semiconductor group slams US Chips and Science Act as violation of fair trade, warns of supply chain chaos

The China Semiconductor Industry Association (CSIA), the state-backed trade group behind the mainland’s integrated circuit industry, has denounced the United States’ Chips and Science Act as a violation of fair trade, while warning that this law could lead to “chaos” in global supply chains.

The CSIA’s statement, which was released on Wednesday in both Chinese and English, joined the chorus of Chinese state media, trade institutions and government voices that have already condemned the recently enacted law, which enables Washington to dangle nearly US$53 billion in incentives to lure more semiconductor manufacturing to the US. Beijing sees the law as a threat to both China’s access to advanced technology needed by its chip sector and the country’s role in supply chains worldwide.

The association, which represents 744 member-firms in China’s semiconductor sector, said the Chips and Science Act, which US President Joe Biden signed into law last week, violated shared principles of fair, open and non-discriminatory practices in the industry.

The CSIA, headed by former Semiconductor Manufacturing International Corp chairman Zhou Zixue, also indicated that the new US law harms the spirit of the World Semiconductor Council’s charter, as well as that of the World Trade Organization (WTO).