The United States will fight to confront Asia on chips

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The ball was “dropped” to the manufacture of chips over the years, allowing China and other Asian centers to mitigate. This is how Gina Raymondo, who was at the time, said in an interview with me in 2021.

Four years later, the chips remain a battlefield in the United States of Chinese race for the superiority of technology, and US President Donald Trump now wants to overcome a very complex and sensitive manufacturing process that took other decades.

He says that his customs tariff policy will liberate the American economy and bring jobs to the homeland, but that is the case that some of the largest companies have struggled for a long time with the lack of skilled workers and weak quality products in their American factories.

So what will Trump do differently? Given that Taiwan and other parts of Asia have a secret sauce to create high -resolution chips, is it possible for the United States to produce them as well?

The semi -conductors are essential to run everything from washing machines to iPhone and military aircraft to electric cars. These small silicone chips, known as chips, were invented in the United States, but today, in Asia the most advanced chips are produced on a huge scale.

Make it costly and technically complex. The iPhone, for example, may have chips designed in the United States, which are manufactured in Taiwan, Japan or South Korea, using raw materials such as rare land that is often filled in China. After that, they may be sent to Vietnam for packaging, then to China for assembly and testing, before shipping it to the United States.

It is a very integrated ecosystem, and it has evolved over the decades.

Trump praised the chips, but also threatened it with tariffs. The pioneering company in the industry has told the Taiwan semiconductor manufacturing company (TSMC), which will have to pay a 100 % tax if it does not build factories in the United States.

With such a complex ecosystem and fierce competition, they should be able to plan to increase costs and investment calls in the long term, outside the Trump administration. Continuous changes in policies do not help. So far, some have shown a willingness to invest in the United States.

The important support that China, Taiwan, Japan and South Korea gave to private companies whose chips have evolved are a great cause of their success.

This was largely the thinking behind the American Chips and Science Law, which became a law in 2022 during the reign of President Joe Biden – an attempt to reshape the chips and diversify supply chains – by allocating grants, tax credits, and support to stimulate local manufacturing.

Some companies, like the largest chip maker in the world and the largest smart phone maker in the world, have become major beneficiaries in this legislation, as TSMC received $ 6.6 billion in grants and loans for plants in Arizona, and Samsung receives $ 6 billion to estimate the facilities in Taylor, Texas.

TSMC has announced an additional investment of $ 100 billion in the United States with Trump, in addition to 65 billion dollars pledged three factories. The diversification of chips on TSMC also works, as China has repeatedly threatens to control the island.

But TSMC and Samsung have faced challenges with their investments, including increasing costs, the difficulty of employing skilled workers, delay in construction, and resistance to local unions.

“This is not just a factory in which the boxes are made,” said Markt Intelligence CounterPoint. “The factories that make chips are sterile high -tech environments, as they take years and years to build.”

Despite the American investment, TSMC said that most of its manufacture will remain in Taiwan, especially the most advanced computer chips.

Today, TSMC plants in Arizona are produced high -quality chips. But Chris Miller, the author of the most important Chip War: The Fight For the World, argues that they are “a generation behind the sensors in Taiwan.”

“The issue of size depends on the amount of investment that takes place in the United States against Taiwan,” he says. “Today, Taiwan has a much greater ability.”

The truth is that it took decades for Taiwan to build this ability, and despite the threat of China’s spending on billions to steal the ingenuity of Taiwan in this industry, it continues to prosper.

TSMC was a pioneer in the “Museum Model” where we took the chip makers designs and manufacturers for other companies.

TSMC managed to ride a wave of startups in the Silicon Valley such as Apple, Qualcomm and Intel, and managed to compete with us and Japanese giants with the best engineers, sharing skilled workers and exchanging knowledge.

“Can the United States make chips and create jobs?” Mr. Einstein asks. “Certainly, but will they get chips to a nanometer? Maybe not.”

One of the reasons is Trump’s immigration policy, which can limit the arrival of skilled talents from China and India.

“Even Eleon Musk suffers from a migration problem with Tesla engineers,” says Mr. Einstein, referring to Musk’s support for the United States H-1B visa program that brings skilled workers to the United States.

“This is the bottleneck and there is nothing they can do, unless they change their position on migration completely. You can not only do a doctoral charm of nothing.”

However, Trump doubled the definitions, and commanded the commercial investigation of national security in the semiconductor sector.

Einstein says: “It is a key to the device – a great pain,” says Einstein. “For example, Japan was based on its economic activation on semiconductors and definitions were not in the action plan.”

The long -term impact on the industry, according to Mr. Miller, is likely to be a renewed focus on local manufacturing in many major economies in the world: China, Europe, the United States.

Some companies can search for new markets. For example, the Chinese technology giant Huawei expanded to Europe and emerging markets, including Thailand, the United Arab Emirates, Saudi Arabia, Malaysia and many countries in Africa in facing export controls and definitions, although margins in developing countries are small.

“China will eventually want to win-you should innovate and invest in research and development in what you did with Deepseek,” says Mr. Einstein, referring to Chatbot of Chinese artificial intelligence.

“If they build better chips, everyone will go to them. The cost effectiveness is something they can do now, and look forward, it is the manufacture of high technology.”

Meanwhile, new manufacturing centers may appear. India has a lot of promise, according to experts who say there is a greater opportunity to integrate into the supply chain of chips than the United States – it’s closer geographically, employment is cheap and education is good.

India has indicated ready to be open to the manufacture of chips, but it faces a number of challenges, including obtaining lands for factories, and the production of chips – needs the highest quality of water and a lot of it.

Chips companies are not completely at the mercy of definitions. Severe dependence and demand for chips from major American companies such as Microsoft, Apple and Cisco can click on Trump to reflect any fees on the chips sector.

Some of the well -known people believe that the severe pressure by the CEO of Apple, Tim Cook secured exemptions on smartphones, laptops and electronic tariffs, and according to Trump’s lifting prohibiting the chips that NVIDIA can sell to China as a result of pressure.

Trump was particularly asked about Apple products on Monday in the Oval Office, “I am a very flexible person, adding that” perhaps there will be upcoming things, I am talking to Tim Cook, I have helped Tim Cook recently. “

Mr. Einstein believes that everything returns to Trump eventually trying to conclude a deal – he and his administration know that they can not only build a larger building when it comes to the chips.

“I think what the Trump administration is trying to do is what I did with the owner of Tijook. He says I will not allow you to work in the United States anymore unless I give Oracle or another American company a share,” says Mr. Einstein.

“I think they are trying to overcome something similar here – TSMC does not go anywhere, let’s justify them to make a deal with Intel and take a slice of the pie.”

But the ecosystem of the semiconductors in Asia has a valuable lesson: no country can manage chips on its own, and if you want to make semiconductor advanced conductors, efficiently and widely – it will take time.

Trump is trying to create a chips industry through protectionism and isolation, when what allowed the chips industry to appear throughout Asia is the opposite: cooperation in a globalized economy.

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