(Source: "China Business News", 2024-12-26)
At the end of 2024, two influential agencies on U.S. w88 policy—the U.S. Department of Commerce and the Office of the U.S. w88 Representative (USTR)—sent out seemingly contradictory signals.
On the 23rd, the Office of the United States w88 Representative (USTR) announced the launch of a Section 301 investigation into policies related to China’s chip industry. Previously, U.S. Commerce Secretary Raimondo stated on the 22nd that the U.S.’s efforts to restrict China’s access to advanced semiconductor technology have not hindered China’s progress, and that curbing China’s semiconductor industry will be a “wasted effort.”
A spokesman for the Ministry of Commerce stated on the 23rd that the US Section 301 investigation has obvious unilateral and protectionist overtones. Previously, the U.S. Section 301 tariffs on China have been ruled by the WTO to violate WTO rules and have been opposed by many WTO members. China has made solemn representations to the U.S. on many occasions. Out of suppression against China and domestic political needs, the United States has launched a new Section 301 investigation into China's chip industry-related policies, which will disrupt and distort the global chip industry and supply chain and harm the interests of American companies and consumers. It is a mistake made again and again.
It is worth pointing out that the United States has provided huge subsidies to its domestic chip industry through the Chip and Science Act. U.S. companies account for nearly half of the global chip market, but it accuses China of so-called "non-market practices" and exaggerates the threat to China's industry. This is obviously contradictory.
In response to the multiple contradictory signals released by the United States, Tu Xinquan, dean of the WTO Research Institute of the w88 casino, said in an exclusive interview with a reporter from China Business News that this may be regarded as the "final madness" of the current U.S. government. The U.S. government has always adopted a similar attitude in many fields. Whether it is directed at the multilateral w88 dispute settlement mechanism or unilateral actions on the grounds of national security, its logic is always the same: as long as the United States believes that an action meets the needs of national security, it will act according to its own wishes and does not care about the positions or reactions of other countries. Even if this action may lead to retaliation, litigation, or other forms of countermeasures, the United States is unwilling to adjust its strategy.
He told reporters that as for the timing of this investigation, it is indeed somewhat intriguing. On the one hand, the USTR is about to usher in a new term. The current w88 representative Dai Qi "reinforced his presence" at the last moment, possibly to pave the way for his professional or political career and leave behind some "results" in his performance of duties. On the other hand, the significance of this survey is difficult to understand in practical terms.
Why does the United States contradict itself
Yicai Global: A spokesperson for the Ministry of Commerce said that the mature process chip report released by the U.S. Department of Commerce not long ago showed that Chinese-made chips accounted for only 1.3% of the U.S. market share. China’s chip exports to the United States are far lower than imports from the United States. In addition to having no market leverage, the United States also launched the above-mentioned Section 301 investigation at the time of the upcoming election. What is the policy logic?
Tu Xinquan: In fact, the core method of the United States launching the Section 301 investigation is to use its market as a bargaining chip.
Historically, whether targeting Japan, the EU, or China, the United States relied on its status as a major export market to impose an "economic stick" to form a deterrent. However, in the field of mature process chips, the United States is neither China's main export market nor does it have enough leverage to put pressure on China. Therefore, this action appears to be particularly contradictory and illogical.
Judging from the current situation of semiconductor w88 between China and the United States, the United States is not China’s main export market for integrated circuits, and exports of related products to the United States only account for about 1.7% of China’s total exports. Similarly, China is not the main source of chip imports for the United States. China-made mature process chips only account for 1.3% of the U.S. market share. With such a negligible w88 volume, the United States chose to launch a Section 301 investigation, and the motives behind it are indeed puzzling.
In addition, even if the investigation is launched, its subsequent implementation will be left to the next government, and there is uncertainty as to whether the policy will be continued after the change. There are many conflicts between the Democratic and Republican parties, but they still chose to launch such an action during this sensitive period, which undoubtedly increased the complexity of the incident.
From an industrial perspective, this Section 301 investigation may not have a substantial impact on the chip industries of China and the United States. As far as I know, relevant Chinese associations have communicated with the US Semiconductor Industry Association. The latter seemed to be surprised by this investigation and obviously did not pay high attention to it. The reason is that the trading volume of mature process chips is limited, and the industry does not regard this as a major event.
Yicai Global: At present, we see that the United States has obvious contradictions in many behaviors. For example, while it is promoting the "Chip and Science Act", it is also supporting its own companies through subsidies. How to evaluate such double standards or contradictory practices?
Tu Xinquan: The United States is a very pragmatic country. Its so-called "moral sense" has always been conditional, bounded, and even limited. Whether in the field of diplomacy or w88, the moral standards of the United States often depend on specific interests.
In the field of w88, the same is true. Looking back at the development of the General Agreement on Tariffs and w88 (GATT), we will find that many of the "exceptions" to the rules were the result of the United States' promotion. For example, the United States has promoted quota restrictions on textile w88 and guided the implementation of agricultural subsidies. These actions are obviously contrary to the principles of GATT, but the United States still goes its own way.
The United States is well aware of the contradictions in its own policies, and these actions are actually "slapping itself in the face." The United States, however, does not care—it fundamentally does not care whether these contradictions undermine its moral foundation or international reputation. In the final analysis, this is just a realistic manifestation of human nature in international affairs.
Does the United States admit that its policy of containing China’s chip development has failed?
Yicai Global: A report released by the New York Fed this summer pointed out that U.S. export control measures have not produced substantial changes in the cooperative relationships between semiconductor companies. How do you think this view is gaining traction in the United States?
Tu Xinquan: Recently, Scott Kennedy, an expert on Chinese business and economic affairs at the Center for Strategic and International Studies, published an article in Foreign Affairs magazine, mentioning the "backfire" of the U.S. technology war. Judging from the actual results, the effect of the U.S. technological blockade on China is indeed not significant. From a more rational perspective, many people in the United States hold similar views. In fact, Microsoft founder Bill Gates expressed similar views earlier.
At the same time, I think the United States may have underestimated China's capabilities. Although chip manufacturing is an industry-specific field, it is more of a "skill" than a simple "technology". In other words, chip manufacturing requires a lot of practice and operation, and gradually breaks through technical barriers through repeated trials and explorations. Although the industry does have certain difficulties, it is not as "out of reach" as the outside world thinks.
For example, in chip manufacturing, Chinese companies have gradually overcome many technical problems that were considered insurmountable in the past. This breakthrough comes more from countless experiments and experience accumulation. However, the really difficult link is equipment manufacturing, especially the research and development of photolithography machines. Lithography machines have extremely high technical requirements. At the same time, due to limited application scenarios and experimental conditions, its research and development is much more difficult than the chip itself. In addition, the United States and other countries have accumulated less in this area in the past, so the current challenge is particularly significant.
Yicai Global: Raimondo mentioned that containing China is "a waste of effort." What proportion does this view hold in the U.S. economic and w88 circles?
Tu Xinquan: Raimundo’s statement does not rule out his reflection on the effects of current policies. In fact, the United States has made frequent adjustments to its export control policies in recent years, especially the continuous increase in the "direct product rules", which just shows that the early measures failed to achieve the expected results. It stands to reason that if the initial restrictive measures have been effective, the United States does not need to increase the restrictions. However, the actual situation is that these policies have not only failed to significantly curb China's development, but have caused market losses to American companies themselves, and the price they have to pay continues to increase.
Therefore, Raimondo’s mention that “containing China is a waste of effort” may reflect her certain disappointment or reflection on the effect of policy implementation. She may be taking stock of the work she has done over the past few years, especially in the context of her outgoing office, and she needs to look at whether these measures are actually what was intended. Clearly, at least for now, these policies are far less effective than their original intentions.
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