The United States considered last year blocking the export of Taiwanese microchips to Russia due to its war in Ukraine but ultimately decided against doing so, said U.S. Commerce Secretary Gina Raimondo on Feb. 23.
“A year ago, we led a coalition of 36 countries to align export controls against Russia,” said Raimondo at an event at Georgetown University in Washington.
“We could have done … we have the tools to do the extraterritorial controls,” she continued. “And I thought about it.”
However, said Raimondo, the Biden administration instead decided to defer to U.S. allies regarding export controls.
“Semiconductors, for example, almost all of the semiconductors made in Taiwan are made with American machinery and software. So technically, we could have said to Taiwan, ‘You can’t sell any of that to Russia because if you do, you can’t use our hardware and software,” she said.
“We prefer not to do that. We prefer to go to our allies, as we did in Ukraine, and say instead, ‘You should control it; you should use your own controls. We don’t want to reach in and do that,’” continued Raimondo. “So that’s the way we want to operate, always with our allies, build consensus, build a coalition.”
Raimondo’s words echoed President Joe Biden’s mantra that the United States should work closely with allies on foreign policy instead of acting unilaterally.
“America is stronger vis-à-vis China if we combine with our allies. And for us, like working with allies, export controls is an article of faith,” she said. “Having said that, I want to be clear about this. Our export controls are narrowly tailored and designed to deny China certain technology that China wants for its military. And we’re going to do whatever we need to do to make that happen.”
Despite the United States not prohibiting the exportation of Taiwanese semiconductors to Russia, Taiwan—which has the world’s largest and most-valuable semiconductor company, Taiwan Semiconductor Manufacturing Company Ltd.—enacted its own export controls on Russia. TSMC produces 92 percent of the chips used in the United States.
“Domestic semiconductor manufacturers have also expressed that they will abide by the laws and closely cooperate with government measures,” said Taiwan’s economy ministry just days after Russia invaded Ukraine, the first anniversary of which is Feb. 24.
During her speech at Georgetown University, Raimondo announced that, starting on Feb. 28, the application process for semiconductor companies to get a portion of the $39 billion allocated for subsidies under the CHIPS and Science Act would begin. The bipartisan law, which Biden signed on Aug. 9, 2022, seeks to spur chip innovation in the United States. Chips are in many items, from computers to cars to toys.
“We have to keep our edge,” said Raimondo.
“We are looking to win the innovation race,” she said.
Additionally, Raimondo highlighted the national security implications behind the semiconductor industry. For example, she noted that “almost all of our sophisticated defense capabilities—satellites, drones, hypersonic weapons—you can’t do any of that without chips.
“Those weapons used by the United States military depend on a supply of chips that are currently not produced in America, and the vast majority are tested in China.”
Moreover, Raimondo called for American education to encourage and train students to go into chip manufacturing.
“In the same way, over the next decade, I am challenging us and calling on colleges and universities to triple the number of graduates in semiconductor-related fields, including engineering.
“And we need more Americans to be a part of this exciting innovation ecosystem. This is math, people. This isn’t a political agenda. This is math.
“These colleges and universities have to expand their recruitment pipelines so that women, people of color, veterans, underserved communities can get these degrees and launch their careers.”
The United States manufactures just 12 percent of the world’s chips, a 25 percent decrease from 1990.
