The Chinese government on Tuesday asked the World Trade Organization (WTO) to crack down on U.S. policies intended to revitalize the domestic computer chip industry.
China claimed the Biden administration used green energy rhetoric to mask protectionist policies.
China’s state-run Global Times displayed not a hint of self-awareness as one of the world’s most protectionist regimes, a ruthless manipulator of markets and currencies, sought to use the WTO as a weapon against American market protections:
During the meeting, China pointed out that the Inflation Reduction Act introduced by the Biden administration in 2022 was a protectionist measure in the guise of “green development.” In its specific implementation rules, the US arbitrarily interpreted “free trade agreements” and seriously undermined global trade rules.
US’ semiconductor subsidy policy, together with its export control measures, have disrupted the global chip supply chain, reflecting the “Cold War thinking” of the US and “trade bullying” when it comes to normal trade, it said. US actions severely damaged the interests of the Chinese side and hurt the interests of all parties, including the US itself and its allies.
China called on the US to eliminate discriminatory and distorting subsidy measures that are not in line with WTO principles. The WTO should strengthen its supervision of US violations, and WTO members should work together to maintain the stability and resilience of the global semiconductor supply and value chains.
The Global Times quoted a Bloomberg News article from Tuesday that found American semiconductor companies are hoping for access to the Chinese markets, delivering an unsubtle warning that such access will not be granted if the U.S. continues to pursue policies that anger Beijing.
The Chinese paper forgot to cite the parts of the article where semiconductor CEOs seemed to agree with the spirit of the CHIPS Act and other rules China despises. They urged the Biden administration to give them “clear rules of the road” for doing business in China and were generally optimistic that such rules would be written.
The South China Morning Post (SCMP) hinted on Thursday that China’s great fear is a growing partnership between the U.S., Europe, and free Asian countries like Japan to minimize China’s influence over the semiconductor industry:
Beijing’s mounting protests underline the widening gap between China and the US on semiconductor supply chains, and may presage further measures by the US to contain China’s chip sector development.
The Netherlands pledged in March to join US efforts to curb advanced chip and equipment exports to China. Japan also said in March that it would require several Japanese companies, including leading semiconductor manufacturing equipment maker Tokyo Electron, to apply for licences to ship 23 types of cutting-edge chip-making tools to China.
Last week, the China Semiconductor Industry Association (CSIA), a state-backed Chinese semiconductor trade group, said Japan’s recent move to expand restrictions on exports of advanced chip-making technology would “bring even greater uncertainties” to the global chip industry, and that it would call on the Chinese government to take “resolute countermeasures” as a response.
Politico noted on Wednesday that the CHIPS Act idea is catching on in other industries as the European Union looks at proposals for a “Critical Medicines Act” that would use similar policies to bolster domestic pharmaceutical production and reduce “dependencies on major producers like China and India.”
This CHIPS Act for European medicine was rolled out in a position paper from Belgium on Tuesday and has 18 sponsor nations, including EU heavyweights Germany and France. The paper noted that “40 percent of all pharmaceutical ingredients globally are sourced from China, and that production for many of these products is concentrated in just a handful of manufacturing sites.”
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