China is the powerhouse of Asia. While the huge nation has the capacity and the resources to stand on its own, it needs external help for some or a few things.
One of which, is the supply of computer chips.
And this time, in order to limit China's access to emerging and more powerful computing technologies, U.S. President Joe Biden's administration announced that it is mulling a revised export control.
The plan here, is to limit Beijing from developing advanced artificial software, and the still-experimental field of quantum computing.
The controls are meant to go well beyond those introduced during the Donald Trump administration. Biden's decision follows Trump's decision to restriction Beijing’s ability to deploy cutting-edge semiconductors in weapons and surveillance systems, as well as to keep China’s technological ambitions under the West's control.
Before Biden's move, U.S. semiconductor equipment manufacturers were prevented from supplying companies that sold to Huawei, which had the effect of severing the device maker from developing advanced chips.
The Trump administration also barred the sale of EUV lithography tools, which are essential to make chips that are under 10 nanometers in size.
This makes chips made in China a few generations less advanced than the ones made by the U.S.
And Biden's move here, is continuing Trump's rules, by making it a choke point to prevent Chinese firms that supply the country’s military from advancing too rapidly.
More specifically, the rules restrict companies using U.S. technology from selling to factories and R&D centers that focus on a advanced technologies, including the so-called nonplanar designs like FinFET and GAAFET at 14 to 16 nanometers, which have enabled increasingly denser transistor counts; DRAM memory made at the 18-nanometer node or smaller; and NAND flash memory with 128 layers or more.
The export restrictions following Biden administration's rules prevent sales to any Chinese facility by default.
Foreign companies that operate factories in China, like Intel, TSMC, or SK Hynix, must first apply to receive exemptions from the rules.
Responding to the situation, China’s top technology overseer convened a series of emergency meetings with leading semiconductor companies, seeking to assess the damage from the Biden administration’s chip restrictions and pledging support for the critical sector.
The Ministry of Industry and Information Technology has summoned the executives from a number of Chinese technology firms including Yangtze Memory Technologies Co. and supercomputer specialist Dawning Information Industry Co. into closed-door meetings.
According to National Security Advisor Jake Sullivan, he acknowledged that "computing-related technologies, including microelectronics, quantum information systems and AI" will gain prominence in the coming decade.
He also noted that export controls are important to "maintain as large of a lead as possible" over adversaries.
Separately, Undersecretary of Commerce for Industry and Security, Alan Estevez, said that the rules is to "protect our national security and prevent sensitive technologies with military applications from being acquired by the People’s Republic of China’s military, intelligence, and security services."
The crackdown marks the most significant action by Washington to date against Beijing on technology exports in decades, escalating the trade battle between the world’s two most powerful economies.
It's also worth noting that the rules is to also regulate the way U.S. citizens and residents participate in Chinese tech firms.
Through the rules, U.S. citizens and green-card holders are also banned from working on certain technology for Chinese companies and entities.
Read: The U.S. Has Been Spying On Hundreds Of Targets, With China As Its Key Target
Semiconductors are the building blocks of the modern digital economy, powering everything from smartphones and PCs, to cars and the internet, as well as animating every major weapon and defense system as well as their command and control architecture, including GPS and space.
In the industry, the U.S. has allies from Taiwan, Japan and South Korea. But China is a powerhouse, capable of withstanding the worse of foes.
And for quite some time, it has been going full speed to build a world-beating microchip industry.
China' aggressive move is already a problem towards the U.S..
What's more, the U.S. is still reliant to on global supply chains that are all too vulnerable to disruption.
In this case, the U.S. is heavily dependent on raw materials that include copper, aluminum, tungsten, antinomy, and gold.
Chile has huge copper reserves, and China has been its biggest customer for years. China on the other hand, is one of the world's largest producer of aluminum. China is also the leading supplier of tungsten, whereas China's ally, Russia, is also one of the largest.
China is also the producer of gallium, the metal used in making chipsets for electronic devices such as computer motherboards or portable phones.
