US $50 billion investment to compete with China’s science and technology efforts
According to IRNA from Reuters news agency; The purpose of the establishment of the fund is to “create useful incentives for the production of semiconductors” (chips) for the United States, to strengthen efforts to increase the competitiveness of the United States with China’s scientific and technological efforts.
The ministry added in a statement that by early February 2023, special guidelines for companies will be published on the methods of applying for financial assistance from this institution.
According to IRNA’s 10th Shahrivar report, quoted by the New York Times website; The American technology company “Nvidia” announced in early September that President Joe Biden’s government has ordered to stop the export of 2 types of computer chips to China.
The technology company “Nvidia” says that these chips are used in projects related to artificial intelligence. This decision could disrupt the ability of Chinese parties to operate in advanced information technology fields such as image recognition. On the other hand, this issue will cause disturbances in Nvidia’s exchanges with China.
The speed of technology development of chip production technology in China has been very impressive in recent years, so that the embargo of Chinese brands by the United States in 2020, which included technology companies from Huawei to Hikvision, led to a boom in domestic chip production in China. .
According to Bloomberg News, based on the collected data, 19 of the 20 companies in the chip industry that had the fastest economic growth in the last four quarters belong to the world’s second largest economy on average. The extraordinary growth shows how tensions between Washington and Beijing are reshaping the $550 billion global chip and semiconductor industry; A sector that plays a huge role in everything from the defense industry to the emergence of future technologies such as artificial intelligence and self-driving cars. In 2020, the United States restricted the sale of American technologies to Chinese companies that produce components.
While shares of some chipmakers have more than doubled from their lows this year, analysts say there may still be room for growth. Beijing is expected to invest billions of dollars in the sector under programs such as the “Little Giants” initiative, to support national tech brands and encourage Chinese procurement tactics to circumvent US sanctions. The emergence of homegrown names has caught the attention of some customers: Apple is said to be eyeing Yangtze Memory Technologies as its latest iPhone flash memory supplier.
In Beijing’s actions, the motivation is to sideline a geopolitical rival and avoid spending on imported chips, which in 2021 will be worth more than $430 billion. According to the data provided, with the increase in the capacity of local factories, orders for chip production equipment from overseas suppliers increased by 58% last year. This in turn creates internal trade. According to the China Semiconductor Industry Association, the total sales of Chinese chipmakers and designers in 2021 jumped 18 percent to a record of more than 1 trillion yuan ($150 billion).
A persistent chip shortage, which is reducing output at the world’s biggest automakers and consumer electronics, also works to the advantage of local chipmakers, helping Chinese suppliers more easily access the international market.
According to IRNA’s report on September 13th, Ro Jong-il, the former senior diplomat of South Korea, told the China Daily newspaper: The chip alliance formed under the leadership of the United States cannot prevent the development and progress of the chip industry in China. China is not a country that can be limited.
According to news reports, the US President Joe Biden’s administration is trying to challenge China to establish its leadership in the semiconductor supply chain in the world by bringing Japan, South Korea and Taiwan into the “4-chip alliance”. Since last year, the US State Department has been trying to upgrade its chip cooperation mechanism in the form of a coalition between governments and allied and partner companies, in order to fundamentally support the US domestic chip industry and regain US control over the supply chain. China’s chipping and isolation can be realized.
The President of the United States has signed into law a $280 billion bill aimed at boosting the domestic chip manufacturing industry and scientific research in the midst of competition with China.
According to news reports, since taking office, the Biden government has adopted the policies of the “Donald Trump” government towards China in order to pressure Beijing and impose sanctions; So that the relations between the two countries continue to be tense. The bill provides funds needed to boost domestic production of semiconductor chips, a critical component of nearly every electronic device today. Another goal of this bill is to prevent crises in the supply chain of goods in the future and to increase the competition between the United States and China in the production of these goods.