Biden plans to sign a plan to strengthen global supply chain solidarity this month
[이미지출처=연합뉴스]
[아시아경제 권재희 기자] Joe Biden’s US administration will strengthen ties with its allies to strengthen the supply chain of core components and raw materials such as semiconductors and electric vehicle batteries. It is interpreted as a plan to isolate China from the world stage by strengthening its alliance against China, which is competing for world supremacy.
On the 24th, the Nippon Geizai Shimbun reported that US President Joe Biden will sign a presidential decree containing such details later this month as a top article on the day.
President Biden said that “cooperation with alliances will create a strong supply chain,” and he plans to establish a national strategy in the supply chain of core components and raw materials. The core components that the US government points to include semiconductors, electric vehicle batteries, rare earths, and medical supplies.
The Nippon Geizai Shimbun said, “The intention is to break down the current regime that relies on China by establishing a new supply chain except China with allies.”
According to the draft obtained by the Nippon Geizai Shimbun, the semiconductor is expected to ties with Korea and Japan, as well as Taiwan, which has friendly relations with the United States. Rare earth is expected to cooperate with Australia and Asian countries.
Specifically, a plan to share information on the supply chain of key products with allies is also discussed. In addition to the way to complement each other, it is known that a structure for prompt procurement among allies in an emergency is under review. It also raises the possibility of a request to reduce transactions with China.
The Nippon Geizai Shimbun said, “The US issuing a presidential decree to cooperate with allies by building a supply chain of major components is because it has determined that it is necessary to establish a new supply chain that completely excludes China from a security standpoint due to confrontation with China since 2018.” Reported.
In fact, China has previously restricted rare earth exports to Japan, which is in conflict over the Sengaku Islands (Chinese name Diaoyudian). The US imports about 80% of rare earths and 90% of medical supplies from China.
Already, the United States has been building a new supply chain since last year. One of them is semiconductor, strengthening relations with Taiwan, which has friendly relations with the United States. Last year, Taiwan’s TSMC announced a plan to establish a 5-nano process production line in Arizona, US with 12 billion dollars (about 13.3 trillion won).
In particular, semiconductors are considered as representative parts that China can weaponize. According to the Boston Consulting Group (BCG), the world market share of semiconductor production capacity in 2020 is 22% and 21% respectively, with Taiwan and Korea ranking first and second, and the United States and China tied third with 15%. The United States ranked 5th with 12%. However, China’s production capacity is expected to increase gradually, accounting for 24% of the world by 2030, becoming the world’s largest. The Biden administration’s initiative is that reliance on China in its supply chain can create security concerns and exert pressure through trade regulation.
Biden’s administration believes that if the US establishes a semiconductor supply chain in connection with Korea, Japan, and Taiwan, it will not only check China, but also prevent China from expanding its market share in the global market. However, in this process, there is a possibility that the US will force Korea, which has major semiconductor makers such as Samsung Electronics and SK Hynix, to choose’America or China’.
However, it is unclear whether countries and companies will respond to this initiative. Nihon Keizai Shimbun said, “The major manufacturers of semiconductors are considered one of the world’s leading manufacturers, and it is up to each company’s judgment whether to keep pace with the US Biden administration. It is highly likely that the establishment of a new supply chain will take a considerable amount of time in the future.” Told.
Reporter Kwon Jae-hee [email protected]