Commentary
Although only some $52 billion in Washington’s $280 billion CHIPS for America Act actually aims to boost semiconductor production in the United States, Beijing is furious and has promised retaliation.
China’s embassy in Washington has declared that Beijing is “firmly opposed” to the legislation officially called the Creating Helpful Incentives to Produce Semiconductors for America Act (and an especially creative acronym, too.) China’s embassy has also described the new law as reminiscent of a “Cold War mentality.” The chairman of China’s Semiconductor Industry Association said that parts of the new American law “violate fair market principles” and will “give China’s rivals a helping hand.” China’s Ministry of Commerce claims the act will “disrupt international trade.” Exacerbating tensions further is Washington’s decision to begin trade negotiations with Taiwan. Though it is unlikely that the United States will bend to China’s objections, the elements of Beijing’s threatened retaliation are not yet clear….