the United States lifts the veil on its plan to counter China

“Cutting Costs, Creating Jobs, Strengthening Supply Chains and Countering China”. The title of press release published on Tuesday, August 9 on the website of the presidency of the United States is enough to take the measure of the law on semiconductors and science signed the same day in the gardens of the White House by President Joe Biden.
He was surrounded by several big bosses of the industry, including Pat Gelsinger, the general manager of Intel, the first American manufacturer of electronic chips.

Launched by the Senate and supported by both Democrats and Republicans, this Chips and Science Act clearly aims to attack Chinese positions in the production of components, the strategic nature of which has been brought to light by the shortages caused by the Covid-19 pandemic. The Chinese Embassy in Washington has moreover said that it sees in this text − with regret − a “reminiscent of the spirit of the cold war”.

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His signature comes a few days after the trip to Taiwan, Wednesday August 3, of the Speaker of the House of Representatives, Nancy Pelosi. By reigniting tensions with Beijing, this visit reminded the United States of the dangers, for national security, of its dependence on components made in China and, more broadly, in Southeast Asia.

Several safeguards

According to the American Semiconductor Industry Association (SIA), the United States represents only 12% of the world’s chip production capacity, three times less than in 1990. In 2020, still according to the SIA, of the thirty-nine new factories built in the world, only four were on American soil, compared to ten in China, ten in Taiwan, five in South Korea, five in Japan, four in Europe and one in Singapore .

To reverse the balance of power, Washington is ready to put on the table 52.7 billion dollars (51.6 billion euros) in subsidies, spread over ten years, of which 39 billion will go to production incentives on the American soil. Two billion will be reserved for chips used in the automotive and defense industries alone. In addition, industrial or equipment investments will give rise to a 25% tax credit, for an estimated cost of $24 billion.

To ensure the effectiveness of these measures, US lawmakers are imposing several restrictions. No way that ” beneficiaries “ of these aids “are building some facilities in China and other countries of concern”, warns the White House. Russia and Iran are part of it, along with North Korea, specifies the text of the law. Beneficiaries must also undertake not to increase the production capacity of their Chinese factories for high-performance chips for ten years.

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