U.S.-China Tech Rivalry Intensifies Over Semiconductors

The ongoing struggle in semiconductor technology between the U.S. and China remains a focal point of concern across global markets. TSMC, widely recognized for its role in Taiwan's semiconductor industry, has recently received significant support through U.S. subsidies, amounting to $6 billion along with $5 billion in loans. This financial backing is indicative of the Biden administration's strategy to bolster domestic semiconductor production amid rising competition with China. Experts believe that while the U.S. is effectively restricting China's access to advanced chip technology through export controls, such measures alone have their limitations. The complex challenge arises as TSMC acknowledges that some of its chips are inadvertently finding their way into Huawei products, demonstrating the difficulties in enforcing these restrictions. Analysts assert that while the U.S. government has taken steps to regulate semiconductor expertise, any long-term strategy must also involve fostering American innovation and research in technology. Initiatives like the CHIPS Act, which combines subsidies for chip manufacturing with an investment of $170 billion in basic science R&D funding, are viewed as essential to maintaining technological leadership over China. As China accelerates its advancements in various tech fields, including AI and computer vision, the competitive landscape continues to evolve. The tech rivalry between the U.S. and China is likely to persist, with implications for both nations' security and economic strategies. Finding a balance between competition and collaboration in non-sensitive areas remains a key focus for policymakers.