Biden Signs Law to Pump $52 Billion Into Domestic Chip Development |
U.S. President Joe Biden signed into law (WaPo) the CHIPS and Science Act, which is set to create one of the largest-ever industrial policies in U.S. history. The law aims to reduce U.S. reliance (Bloomberg) on foreign suppliers—particularly China and Taiwan—for the advanced semiconductors, also known as chips, that are needed for weapons systems and other technologies. It will also create regional start-up hubs that Washington hopes will lead to breakthroughs in fields such as quantum computing and artificial intelligence.
Firms including Intel and Taiwan Semiconductor Manufacturing Company say they will apply for funding from the law to support the construction of factories in the United States. Companies that receive money under the law will have to pledge not to increase chip production in China. A Chinese Foreign Ministry spokesperson voiced Beijing’s opposition to the law, saying it will “distort” supply chains.
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“It feels...as if a new era is beginning in which government support to strengthen the competitiveness of industries—for reasons of business, national security, public health and the environment—will be seen as more necessary and normal than in the past,” the Center for Strategic and International Studies’ Scott Kennedy tells the Washington Post.
“Though the legislation marks a landmark investment by the U.S. government in domestic chipmaking, $52 billion in subsidies is a relatively small sum in the world of semiconductor manufacturing, which demands massive amounts of investment,” Nikkei’s Jack Stone Truitt writes.
This Backgrounder looks at industrial policy’s comeback. |
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Beijing Withdraws Pledge Not to Base Troops in Taiwan if It Takes Over |
Reuters reported that a new military strategy paper omitted a promise not to send troops or administrators to be based in Taiwan if China takes control of the island. Two previous white papers, in 1993 and 2000, said Beijing would not do so.
For Foreign Affairs, Elbridge Colby writes that the United States should prepare for a war over Taiwan.
U.S./North Korea/South Korea: U.S. and South Korean envoys discussed how to counter illicit cyber activities (Yonhap) by North Korea. The meeting came after Washington sanctioned a group accused of laundering money stolen by North Korean hackers. |
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India’s Lower House Passes Energy Conservation Bill |
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Middle East and North Africa |
Iran Makes First Import Order Using Cryptocurrency |
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UN Official: 750,000 Ethiopian Refugees Will Have ‘Nothing to Eat’ Without Funding |
UN agencies called for $73 million (UN News) over the next six months to provide food aid to Ethiopia. Food aid for refugees in the country was cut by 50 percent earlier this year.
U.S./DRC/Rwanda: In Kinshasa, Democratic Republic of Congo (DRC), U.S. Secretary of State Antony Blinken said Washington is concerned by “credible” reports (AFP, France 24) that Rwanda is backing rebels in the DRC. Rwanda denied the reports. |
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Explosions Rock Airfield in Russia-Occupied Crimea |
An unnamed Ukrainian official told the Washington Post that Ukrainian special forces were behind the blasts. In his nightly address, Ukrainian President Volodymyr Zelenskyy vowed to win back Crimea but did not mention the blasts.
Europe: The Rhine River is set to become impassably dry (Bloomberg) at a waypoint for shipping this week. It is the latest consequence of Europe’s severe drought. |
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Mexican President Details Plan to Put National Guard Under Military Control |
President Andrés Manuel López Obrador said that if he cannot win support for a constitutional amendment that lets the military take over the National Guard, he could issue a decree (Bloomberg) to allow it.
Colombia: A New York Times investigation showed how the UN Development Program has partnered with oil companies, making it easier for them to work in areas where people oppose drilling, including in the Amazon Rainforest. |
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Council on Foreign Relations |
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