Chips are the new oil in the geopolitical landscape, shaping power dynamics as they are critical to modern technology. The United States and China are in a race to control this valuable resource, with Taiwan Semiconductor Manufacturing Company (TSMC) at the centre. The US has imposed restrictions on chip sales to Huawei, a move that could potentially cripple the Chinese tech giant.
In response, China is investing heavily in its domestic semiconductor industry, aiming for 70% self-sufficiency by 2025. Yet, the country’s efforts face significant hurdles due to the complexity of chip manufacturing, which requires advanced technology and expertise.
Meanwhile, Taiwan has a precarious position. As home to TSMC, it holds significant power in the chip industry but is also vulnerable to Chinese aggression. The US, recognising Taiwan’s strategic importance, is encouraging TSMC to build a factory in Arizona, reducing dependency on the island.
The chip war is thus a power play, with countries vying for control over a vital resource. The outcome will shape the future of technology and global power dynamics.
Go to source article: https://stratechery.com/2020/chips-and-geopolitics/