China-US chip war: America is victorious
The US-China chip war has been raging on for years, and despite China’s attempts to outstrip the US in chip manufacturing, it looks like America is winning. The competition between the two nations has been intensifying in recent years as both seek to gain a foothold in the lucrative semiconductor market. This article will explore the US-China chip war and how America is coming out on top. We’ll look at how US companies are leading the way with innovative technology, while Chinese companies are struggling to keep up with their American counterparts. We’ll also examine why this may be beneficial for consumers in terms of pricing and performance.
How does the United States impede China’s progress?
The US is making it difficult for China to gain a foothold in the global semiconductor market. American companies are refusing to sell chips to Chinese firms, and the US government is blockading chip-making equipment from being shipped to China. This is crippling China’s attempts to build a domestic semiconductor industry, and it’s a major blow to the country’s technological ambitions.
This strategy appears to be working, as China’s progress in the semiconductor space has been stifled in recent years. The US is currently leading the world in chip manufacturing, and it doesn’t look like that’s going to change anytime soon.
China’s action
Since the United States and China began their trade war, the semiconductor industry has been one of the key battlegrounds. The Trump administration has placed tariffs on $250 billion worth of Chinese imports, including semiconductors, and has threatened to add more. China, meanwhile, has been trying to catch up with the U.S. in chip production.
One area where China has been making inroads is in the field of artificial intelligence (AI). AI chips are used in everything from autonomous vehicles to facial recognition software. And while the U.S. still dominates the AI chip market, China is quickly catching up.
In 2018, Chinese companies accounted for 17 percent of global AI chip sales, up from just 5 percent in 2016, according to research firm Gartner. And Chinese firms are expected to make up 25 percent of the global AI chip market by 2020.
The reason for China’s rapid growth in this area is twofold. First, the Chinese government has made a major push to develop its own semiconductor industry. Second, many of the world’s leading AI chipmakers are based in China or have significant operations there.
Some of the most notable Chinese AI chipmakers include Huawei’s HiSilicon unit, which makes Kirin processors for smartphones; Baidu, which offers its own self-driving car platform; and Sense Time, a startup that makes facial recognition software for use in surveillance systems.
If China continues to gain ground
Global Trade
As the United States and China continue their trade war, the focus has shifted to the semiconductor industry. The U.S. is targeting China’s reliance on imported chips, and Beijing is retaliating by hitting American chipmakers that do business in China.
But despite the tit-for-tat tariffs, the U.S. is winning the battle.
China’s economy is more dependent on trade than America’s, so Beijing has more to lose in a prolonged fight. The U.S., on the other hand, is less reliant on exports, and its domestic market is much larger than China’s. So even if American companies are hurt by Chinese tariffs, they can still find customers at home.
The U.S. also has an ace in the hole: Taiwan. The island nation is one of the world’s leading producers of semiconductors, and many of China’s chips are made there. If Taiwan starts shipping its chips to the U.S., it would be a major blow to Beijing’s plans.
In short, the U.S.-China chip war is just another front in the ongoing trade conflict between these two nations. And so far, America is winning.
What follows?
As the US-China chip war continues, America is starting to gain the upper hand.
US companies are pulling ahead in the race to develop cutting-edge semiconductor technology, and China is lagging behind. That’s according to a new report from investment bank Goldman Sachs, which says American firms are “dominating” the development of next-generation chips.
The report comes as the Trump administration is ratcheting up pressure on Beijing over its high-tech ambitions. The US has accused China of stealing American intellectual property and forcing US firms to transfer technology to Chinese partners.
Goldman Sachs says the US is “well positioned” to win the chip war because it has a strong ecosystem of suppliers, customers and investors. American firms account for more than half of global semiconductor sales, and they control about two-thirds of the world’s chip-making capacity.
What’s more, US companies are investing heavily in research and development. They spent a record $16 billion on R&D last year, according to Goldman Sachs. And they’re pouring money into new chip factories that use the latest manufacturing technology.
All of this gives US firms a big advantage over Chinese companies, which are struggling to catch up. So far, China has only been able to produce low-end chips for smartphones and other consumer electronics. But it needs advanced chips for products like autonomous vehicles and artificial intelligence
