The world’s technology-leading democracies must take a fresh approach to high-end tech exports and policy to prevail in the competition with China. The global semiconductor industry is an illustrative case study. As part of its Made in China 2025 initiative — a wide-ranging industrial policy intended to vault China into the select club of global technology powers — Beijing seeks to wean itself off dependence on foreign sources for semiconductor manufacturing and position itself as an independent semiconductor powerhouse.
This technonationalism strategy is ambitious. Semiconductors are particularly vexing because they require extensive know-how and meticulous manufacturing practices. To build its own semiconductor foundries, China is dependent on foreign semiconductor manufacturing equipment — the machinery needed to produce semiconductors — made by companies in just a handful of countries. The United States, Japan, and the Netherlands account for 90 percent of global market share.
Read the full story in The Diplomat.
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