If the Biden administration achieves its goals, more electronic chips will be produced in U.S. states like Texas and Arizona, then shipped to countries such as Costa Rica, Vietnam, or Kenya for final assembly. These locations aren’t typically associated with semiconductors, but U.S. officials aim to revamp the global chip supply chain through a strategy dubbed “chip diplomacy.” This involves attracting foreign investment in U.S. chip production and establishing overseas factories for final assembly. The administration argues this will bolster American prosperity and security, reduce reliance on China, and mitigate supply chain disruptions like those seen during the pandemic and the war in Ukraine.
The U.S. has already drawn $395 billion in foreign investment for semiconductor manufacturing and $405 billion for green technologies. Asian tech giants, such as SK Hynix, are leading these investments, exemplified by a $3.8 billion chip factory in Indiana. The Biden administration’s legislative efforts, including the CHIPS Act, aim to modernize infrastructure and secure supply chains, with $50 billion allocated for domestic chip research and manufacturing.
Despite these efforts, challenges remain. East Asian countries dominate chip production with advanced technologies and lower costs. The U.S. semiconductor industry could face a workforce shortage of up to 90,000 over the next few years. Nevertheless, the U.S. share of global chip manufacturing is projected to increase to 14% by 2032.
Moreover, the administration is pushing allied countries to restrict advanced technology sales to China, balancing coercive diplomacy with fostering international partnerships for the American industry. The initiative includes training programs involving institutions like Arizona State University and Vietnam National University to build a skilled workforce.
This multifaceted strategy leverages alliances and investments to create a resilient and diversified chip supply chain, thereby positioning the U.S. to meet its strategic and security objectives.
Original Story https://www.nytimes.com/2024/07/08/us/politics/supply-chain-china-tech.html
Category : Supply Chain,International Relations,Factories and Manufacturing,Computer Chips,Foreign Investments,American Jobs Plan (2021),United States International Relations,Alternative and Renewable Energy,Biden, Joseph R Jr,East Asia,United States,China
Tags:
