Chip Wars: Xi Jinping said that no one can stop China in technological development

Regardless of Western technology sanctions, China will continue to progress even without ASML machines, its President Xi Jinping told Dutch Prime Minister Mark Rutte

by Sededin Dedovic
Chip Wars: Xi Jinping said that no one can stop China in technological development
© Kevin Frayer / Getty Images

The geopolitical scene is increasingly riddled with tensions over the development and control of technology, and chips are at the center of that conflict. Chinese President Xi Jinping's recent meeting with Dutch Prime Minister Mark Rutte gave us an insight into China's strategies in the face of US sanctions and efforts to limit its access to advanced chip technology.

The Chinese leader was open in his view that American and allied attempts to isolate China from the most modern chips will not be successful. "The Chinese people also have the right to legitimate development, and no force can stop the pace of China's scientific and technological development and progress," Xi Jinping said, according to the AP news agency.

This was a direct reaction to the Netherlands' decision to impose export controls on key chip-making machinery from Dutch giant ASML in line with US demands. These machines are essential for making the smallest and fastest chips, and their limitation is a significant blow to Chinese semiconductor makers.

However, China is showing signs of adaptability. A recent partnership between SMIC, a leading Chinese chipmaker, and Huawei, a global telecommunications giant, has resulted in the development of an advanced 7nm smartphone chip using older ASML machines.

This shows China's ability to adapt and solve challenges innovatively. Moreover, there are also reports that the same companies are working on 5nm class chips with this technology.

A pedestrian talks on the phone while walking past a Huawei Technologies Co.

store on January 29, 2019 in Beijing, China© Kevin Frayer / Getty Images

China is also responding to the sanctions by increasing national investment in technological development, especially in the semiconductor industry.

This strategy shows China's determination to become more independent in the production of key components. If China makes a breakthrough in the production of semiconductors, it would mean a big change on the global stage, and with the size of the market and production capacities, China will probably be the leader in that industry.

Geopolitical Tensions and Technological Domination

The conflict over chips is just one segment of the broader geopolitical rivalry between China and the US. The US has expressed concern over the potential military applications of China's high-performance chips in domains such as artificial intelligence and supercomputing.

However, China claims that such concerns are unfounded and that it is an attempt by the US to maintain technological dominance. Analysts warn that US sanctions may backfire. Rather than slowing China's development, these measures could actually encourage China to invest even more and make faster progress in order to free itself from dependence on foreign technologies.

This could lead to a global chip arms race, with far-reaching geopolitical and economic implications. In this tense environment, international cooperation is necessary to ensure a stable and balanced chip market for the benefit of end users.

Open markets and transparent exchanges of technology should be the norm these days, but due to the importance of this industry, the political pressure is too great. The future of the chip industry is inextricably linked to geopolitical rivalry.

China is showing determination to overcome obstacles and develop its domestic chip industry. While the short-term effects of sanctions may slow China's progress, the longer-term outcome is uncertain. China could potentially achieve technological independence, which would disrupt the global chip supply chain and geopolitical balance.

In this battle for chip dominance, other countries like the European Union find themselves in an awkward position. On the one hand, the EU has economic ties with both China and the US. On the other hand, there are legitimate security concerns about China's technological ambitions.

Therefore, the EU strives for neutrality and seeks to develop its own chip industry to escape US pressure and reduce dependence on China. It is difficult to predict the final outcome of the technology war over chips. China is determined to become a leader in this industry, while the US seeks to maintain its lead.

However, the influence of neutral actors like the EU can be crucial in this race. The USA derives its advantage from this due to its historically good relations with the EU, but the elections in the European Parliament are coming soon, which may have unexpected results.

The right is getting stronger in Europe, and these elections will show us how much strength they have gained since the last election. Regardless of the winner, it is important to note that both China and the US are still interdependent.

Disruptions in the global chip market could have cascading effects on both nations. Also, there are global challenges such as climate change and pandemics that require international cooperation and the best possible relations are needed.

Technology, such as advanced chips, can be instrumental in solving these challenges. Therefore, the search for global solutions and common standards, instead of exclusion and dominance, could be a more productive way forward.

Xi Jinping China