Published in PC Hardware

US probes another Chinese chip "threat"

by on22 December 2023

Worried about legacy chips now

The US has announced a probe into how its firms buy Chinese-made chips, under the unproven claim that they could pose a danger to national security.

The investigation will start in January 2024 and will look at legacy chips which are older than Joe Biden but vital for many industries.

Commerce Secretary Gina Raimondo said there were signs that China was trying to take over the legacy chip market and squeeze out US rivals. She said the chips were crucial for telecoms, cars, and defence. She added that the probe would collect data from US firms to see how much they depend on Chinese chips.

The data would help the US to "build strong, diverse and resilient" chip supplies, she said.

A report this month by a cross-party group of lawmakers urged the department to slap tariffs on Chinese legacy chips.

They said China had to be stopped from dominating the market and gaining "excessive leverage" over the world economy. They called for a tougher stance against China's "unfair" competition. We guess they think that is America’s job.

The department said US firms made half of the global chip revenue but faced fierce rivalry from foreign rivals backed by state subsidies. Meanwhile, the US government does not give any subsidies to any of its chipmakers and they have to face the rigours of market competition rather than communist government money. (Yes we know that is rubbish but there are a few in the US who actually believe it).

What is interesting is that while the government is claiming the issue is all about "national security" most of the comments are about how American industry is being shut out by the Chinese. This was the same reasoning that saw European telcos forced to pay for more expensive 5G gear because the Americans would not allow us to buy cheaper Huawei gear.


Last modified on 22 December 2023
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