The US Department of Commerce on Thursday said it would launch a survey of the US semiconductor supply chain and national defense industrial base to address national security concerns from Chinese-sourced chips.
The survey aims to identify how US companies are sourcing so-called legacy chips — current-generation and mature-node semiconductors — as the department moves to award nearly US$40 billion in subsidies for semiconductor chip manufacturing.
The department said the survey, which would begin next month, aims to “reduce national security risks posed by” China and would focus on the use and sourcing of Chinese-manufactured legacy chips in the supply chains of critical US industries.
Photo: Reuters
A report released by the department on Thursday said Beijing has provided the Chinese semiconductor industry with an estimated US$150 billion in subsidies in the past decade, creating “an unlevel global playing field for US and other foreign competitors.”
“Over the last few years, we’ve seen potential signs of concerning practices from [China] to expand their firms’ legacy chip production and make it harder for US companies to compete,” US Secretary of Commerce Gina Raimondo said.
China’s embassy in Washington said that the US “has been stretching the concept of national security, abusing export control measures, engaging in discriminatory and unfair treatment against enterprises of other countries, and politicizing and weaponizing economic and sci-tech issues.”
Raimondo last week said that she expects her department to make about a dozen semiconductor chip funding awards within the next year, including multibillion-dollar announcements that could drastically reshape US chip production.
Her department made the first award from the program on Monday last week.
The survey would also help promote a level playing field for legacy chip production, the department said.
“Addressing non-market actions by foreign governments that threaten the US legacy chip supply chain is a matter of national security,” Raimondo added.
US-headquartered companies account for about half of global semiconductor revenue, but face intense competition supported by foreign subsidies, the department said.
Its report said the cost of manufacturing semiconductors in the US might be “30 to 45 percent higher than the rest of the world” and it called for long-term support for domestic fabrication construction.
The US should enact “permanent provisions that incentivize steady construction and modernization of semiconductor fab facilities, such as the investment tax credit scheduled to end in 2027,” the report added.
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