Attempts by the United States, Japan, Australia and India to deepen their ties in critical and emerging technologies are aimed at marginalizing China in critical global industrial and supply chains, which will hurt interests of their own businesses.
As part of the Quadrilateral Security Dialogue (or “Quad”), the leaders of these four countries announced in a joint statement on Tuesday that they would strengthen cooperation in the field of 5G, semi- drivers, biotechnology and quantum technologies, including closer partnership in international standardization organizations.
According to Bai Ming, deputy director of the Institute for International Market Studies affiliated with the Chinese Academy of International Trade and Economic Cooperation (CAITEC), even though the Quad avoids mentioning China in its statements, these measures are aimed at reducing China’s presence in global industrial chains, which is likely to affect the activities of many companies operating in China.
He noted that China is the world’s largest market for semiconductors and its chip production capacity is also increasing, making it a very important player in the global semiconductor industry chain. no business can ignore.
The mainland of China imports more than 300 billion dollars (280 billion euros) of semiconductors each year. Most, if not all, of the major U.S. semiconductor companies make at least 25% of their global sales to companies in the Chinese mainland, according to an article published on the official website of the Brookings Institution.
“Access to this colossal market (China) is critical to the success of any globally competitive semiconductor company today and will be in the future as well,” a research report said. Semiconductor Industry Association (SIA), a Washington-based group representing the US semiconductor industry.
According to the SIA, the Chinese mainland accounted for 11% of global semiconductor manufacturing capacity in 2019. This figure is expected to reach 18% in 2025 and nearly 19% in 2030.
“Any attempt to marginalize China risks straining global industrial and supply chains, which are already struggling with the lingering impacts of the Covid-19 outbreak,” warned Bai Ming.
Frank Meng, CEO of Qualcomm China, recently announced that strong relationships between global technology companies are the greatest stabilizing force for global collaboration. This heavyweight in the sector is strengthening its investments, increasing its presence and multiplying its partnerships in China.
“Qualcomm will continue to engage closely with China’s industries to jointly build a digital ecosystem. We also advocate rapid adoption of 5G, artificial intelligence and Internet of Things across various industrial sectors, to help fuel China’s high-quality economic development,” he said. he explains.
Dong Yifan, a researcher with the Institute of European Studies affiliated with the Beijing-based China Institute of Contemporary International Relations, said the Quad’s efforts to create a small, exclusive circle risked divisiveness rather than promoting cooperation. within the global digital economy, but also to lead to the fragmentation of the corresponding rules, mechanisms and markets.
He said the Quad’s efforts to deepen cooperation in international standardization organizations are also aimed at reducing China’s weight in the global telecommunications arena. They are in essence aimed at stemming the development of related industries in China, shaping the international standards of 5G and beyond.
China has played a crucial role in drafting global 5G standards. Four of the top ten holders of 5G standards-essential patents are Chinese companies. As of December 31, 2021, Huawei Technologies ranked first with a 14% share, data from the China Academy of Information and Communications Technology (CAICT) shows.