Publisher's Note
The Joe Biden administration is putting increasing pressure on semiconductor companies while regarding hegemony in the industry as a key part of national security. The White House had an online meeting on Sept. 23 with semiconductor manufacturers including Samsung Electronics, TSMC and Intel, which was presided over by National Economic Council Director Brian Deese. It is this year’s third White House meeting with those companies, which shows how much the United States is focusing on the growth of its semiconductor sector.
At the meeting, the U.S. Department of Commerce told the participants to submit their confidential data within 45 days. The data demanded by the department include three-year sales, raw material and equipment purchase statuses and client information. Although the department explained that the request is to deal with the ongoing global chip shortage, it is an excessive market intervention, needless to say.
The U.S. government could demand the data to secure semiconductors preferentially because the ongoing undersupply of automotive chips is seriously affecting U.S. automakers. But, the U.S. government is reportedly even considering using the Defense Production Act of 1950, which is a wartime law, to get the data and this is nothing but a threat taking advantage of its power, undermining the value of free trade and market economy, which has been cherished by none other than itself.
Semiconductor companies’ confidential data is something unshareable even with the U.S. government, even if it promised to keep the information in secret. There is no guarantee that Intel, Micron Technology, Apple and other U.S. companies will not gain access to the data with, for example, Intel having recently announced to re-enter the foundry market and the move being supported by the U.S. government.
U.S. Commerce Secretary Gina Raimondo said that a more aggressive move is needed, which is a particularly worrisome point. In the 1980s and 1990s, the United States mobilized anti-dumping investigations, intellectual property litigation, and many more in order to keep Japan in check in the global semiconductor industry. As a result, Japan had to surrender its lead in the industry and specialize in key material supply and manufacturing equipment.
U.S. President Joe Biden is stressing the importance of the industry as a key sector and pursuing the establishment of a U.S.-led semiconductor supply chain to hinder the growth of the Chinese semiconductor industry. In line with the policy, Samsung Electronics decided to expand its foundry facilities in the United States. The global leader has to retract the excessive demand.
The South Korean government also needs to make more diplomatic efforts in order to better protect the semiconductor sector of the nation. This is because the global hegemonic rivalry in the industry and the America First policy of the United States can hardly be dealt with by individual enterprises.