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China Says US Chip Act Will Harm Supply Chain, Global Trade

US lawmakers have approved legislation to subsidise its domestic semiconductor industry to help it compete with China and Taiwan

Semiconductor chips are seen on a circuit board of a computer in this illustration picture taken on February 25, 2022. Photo: Reuters


China has slated a major new chips act passed by the US Congress claiming it will distort the global semiconductor supply chain and disrupt international trade.

China’s commerce ministry spoke out on Friday after the US House of Representatives passed sweeping legislation to subsidise its domestic semiconductor industry aimed at helping the US compete with the likes of China and Taiwan.

China had lobbied against the bill, calling it reminiscent of a “Cold War mentality” and “counter to the common aspiration of people” in both countries.

China said it will take measures to safeguard its rights, if necessary, as and when the act is implemented.


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Taiwan’s leaders, meanwhile, were confident its key position as the world’s leading chipmaker would not be threatened by the legislation.

Taiwan is home to Taiwan Semiconductor Manufacturing Co Ltd (TSMC), the world’s largest contract chipmaker, which is also investing $12 billion in a new plant in Arizona.

The Economy Ministry noted that it is “happy to see” Taiwanese firms being able to access “resources on the ground” when they operate around the world, and to establish good relations in the US supply chain.

“Whether in the past, present or future, Taiwan will continue to play the role of an indispensable partner in the global supply chain,” said the ministry.

Taiwan has been keen to show the United States, its most important international backer at a time of rising military tensions between Taipei and Beijing, that it is a reliable friend as a global chip crunch impacts auto production and consumer electronics.

But Taiwan’s government is also determined to keep the majority of advanced chip manufacturing at home.


  • Reuters with additional editing by Sean O’Meara




Read more:

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Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.


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