Xinhua Commentary: U.S. chip bill is good for no one-Xinhua

Xinhua Commentary: U.S. chip bill is good for no one

Source: Xinhua

Editor: huaxia

2022-08-24 14:46:45

BEIJING, Aug. 24 (Xinhua) -- The Chips and Science Act recently passed by the U.S. Congress is a typical act of economic coercion that seriously violates market laws and international economic and trade rules, distorts the global semiconductor supply chain, and disrupts international trade. Creating restrictions and decoupling is not good for anyone.

The U.S. legislation will intensify global geopolitical competition in the semiconductor industry and hinder global economic recovery and innovative growth. This practice of obstructing the normal exchange and cooperation within the global business community by means of state power and launching unfair competition on the basis of discrimination against other countries is bound to draw widespread criticism.

The design, manufacturing and even raw materials of a complete and complex product like semiconductors, especially chips, are usually distributed across many different countries and regions, thus forming a huge network. No matter how hard countries try to support their own manufacturing bases and localize their production, it is almost impossible to decouple from global supply chains. A certain degree of interdependence among countries is inevitable.

The U.S. legislation promises huge subsidies to the local chip industry and tax incentives for semiconductor and equipment manufacturing in the United States and encourages enterprises to build factories there. These provisions discriminate against some foreign companies, highlighting the fact that the United States intends to use state power to forcibly change the international division of labor in the semiconductor industry, which harm the interests of enterprises from all over the world, including Chinese and American enterprises.

No matter what development path the United States chooses, it should comply with World Trade Organization (WTO) rules and the principles of openness, transparency and non-discrimination, and should contribute to the security and stability of global industrial and supply chains. Advocating and actively promoting sound, fair and just international competition is the responsibility of a major country. However, what the United States has said and done is exactly the opposite.

It is the United States' own business what development path it chooses, but this is not a valid reason for suppressing China's chip industry through economic coercion. The United States has always been good at coercion. With its advantages as a superpower, the United States suppresses whoever disobeys it on the international stage.

For a long time, the United States has imposed sanctions on Cuba, the Democratic People's Republic of Korea, Iran, Venezuela and other countries; arbitrarily provoked trade wars against many countries; unscrupulously suppressed multinational companies such as Alstom of France and Toshiba of Japan, as well as high-tech enterprises of other countries, all in the name of national security.

Aside from the United States, there are no other countries in the world that can apply such a range of economic coercion on a global scale. What the United States has done is ridiculous and shocking.

After dealing with China for so many years, the United States should know with clarity that China has never been afraid or backed down in the face of coercion from the United States.

Neither restrictions nor suppression will hinder China's scientific and technological development and industrial progress. China's economy is resilient and has great potential and vitality, and the economic fundamentals that will sustain long-term growth remain unchanged. China's development still has multiple favorable strategic conditions, such as a huge domestic market, a constantly-improving business environment, an increasingly complete industrial system and infrastructure, a mature and outstanding team of engineers, and a strong capacity to stabilize production amid the COVID-19 epidemic.

The United States and China should have been able to complement each other's advantages, and achieve mutual benefit and win-win results through division of labor and cooperation in the global industrial chain. However, the United States is blinded by its immediate selfish interests. China-U.S. economic and sci-tech cooperation serves the shared interests of both sides and contributes to the common development of humanity. The United States must not set up barriers to disrupt normal economic and sci-tech exchanges and cooperation between the two countries or undermine China's legitimate development interests. Creating restrictions and decoupling would hurt others without benefiting the United States itself.

Economic globalization is the trend of our times. Though countercurrents are sure to exist in a river, none can stop it from flowing to the sea. Driving forces bolster the river's momentum, and resistance may yet enhance its flow. Despite the countercurrents and dangerous shoals along the way, economic globalization never has and never will veer off course.

The U.S. bill goes against the trend of our times. Those who try to block other people's paths will only end up blocking their own. This is not alarmism, but the law of history.