US President Joe Biden’s administration is launching an investigation that would offer US president-elect Donald Trump a choice about whether to enact new tariffs on semiconductors made in China.
The White House yesterday announced that it would initiate the inquiry into so-called foundational chips — also known as legacy or mature-node semiconductors — made in China. While not as advanced as the chips driving artificial intelligence, the older technology is ubiquitous across a wide range of applications, including vehicles, planes, medical devices and the telecommunications industry.
The move tees up potential tariffs on a sector that US officials said might pose a national security risk if too heavily concentrated in Chinese control.
Photo: AP
“We need resilient supply chains for these chips, because we saw what happened during COVID[-19] when we needed a chip, but we can’t have it,” US Secretary of Commerce Gina Raimondo told reporters on Sunday.
Relying on overseas suppliers snarled US production lines and drove up the cost of household goods, she said.
Raimondo and other US officials briefing reporters said that China has expressed its desire to dominate the global chip market and is unfairly subsidizing the industry, but the investigation is necessary to take legal action.
Called a Section 301 investigation after the law that authorizes it, the US trade representative would first determine whether China’s actions have been “unreasonable” or “discriminatory,” and burden US commerce. If so, the future administration could impose retaliatory tariffs, restrict imports — or recommend further action for the US president and Congress.
The probe would take months, leaving any decision up to Trump’s administration, which also used the same trade powers to enact wide-ranging levies on imports from China.
Trump said he would nominate Jamieson Greer for US trade representative, replacing US Trade Representative Katherine Tai (戴琪).
Biden has moved to bolster the US semiconductor industry, including with a bipartisan subsidy bill that has included steps to limit the export of advanced technology to China.
US officials worry that China can flood, and corner, the market with older, widely available types of chips and tighten its grip on the sector.
The White House earlier this year announced that it would increase tariffs on Chinese legacy semiconductors from 25 percent to 50 percent by next year.
HANDOVER POLICY: Approving the probe means that the new US administration of Donald Trump is likely to have the option to impose trade restrictions on China US President Joe Biden’s administration is set to initiate a trade investigation into Chinese semiconductors in the coming days as part of a push to reduce reliance on a technology that US officials believe poses national security risks. The probe could result in tariffs or other measures to restrict imports on older-model semiconductors and the products containing them, including medical devices, vehicles, smartphones and weaponry, people familiar with the matter said. The investigation examining so-called foundational chips could take months to conclude, meaning that any reaction to the findings would be left to the discretion of US president-elect Donald Trump’s incoming team. Biden
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