Chipmakers in Taiwan, Japan and Japan oppose US efforts

Chipmakers in Taiwan, Japan and Japan oppose US efforts

As of last week, a number of individuals from the members of the de facto chip club Washington have expressed their unwillingness to restrict their production and investment in China. It is only those on Taiwan's island of Taiwan, under the coercion of the secessionist-minded Tsai Ing-wen authorities, who have not added their voices to the chorus.

The Republic of Korea government has urged the Joe Biden administration to review its guardrail rules regarding chip subsidies, as it does not think that the US government providing ROK chip companies, such as Samsung and SK Hynix, with subsidies to encourage them to invest in the United States should affect their decisions to expand production on the Chinese mainland.

The Dutch government has also stressed the necessity for the Netherlands to continue to engage with such a major economy as China, which it says is a preferred economic and trade partner.

On different occasions, Nvidia and Panasonic CEOs, both from the US and Japan, have said that the Chinese mainland market is irreplaceable.

All these show the strong opposition to Washington's attempts to re shape the global industry and supply chains of the chip sector in the US' favor. Although the Biden administration may lure the chip giants to expand production in the US through offering them market-law - distorting subsidies, it cannot offer a substitute for the Chinese mainland's huge chip market if it forces them to withdraw from it as a condition for receiving the subsidies.

The US' decoupling efforts in the chip industry will wreak havoc on the stability of related industries worldwide, such as automobiles, information, and electronics. The companies from the USA and its allies will bear the brunt of Washington's weaponsization of technology and trade for its own geopolitical ends as it pushes up the prices of relevant end products from the Chinese mainland.

After the Japanese government announced it would install China-targeted export control measures on semiconductor manufacturing equipment from July this year, the share price of several Japanese semiconductor-related companies, including Screen Semiconductor Solutions, Advantest and Disco, fell instantly.

This clearly shows the market's opinion of the impact of the US' tech offensive. Japan's chip exports were worth about 30 percent of the country's chip exports last year. It remains to be seen how the Japanese companies will fill the gap now that Tokyo is shutting its doors on the Chinese mainland at the behest of the US.

To hobble China's modernization, that question applies to all companies that the U.S. wants to use as pressure points.