Jakarta, CNBC Indonesia – US President Joe Biden and Chinese President Xi Jinping will meet this week to discuss tensions between the two countries. These include issues regarding communication between military forces, as well as restrictive policies for the semiconductor industry.
Biden and Xi Jinping will meet face to face at the Asia Pacific Economic Cooperation (APEC) forum which will be attended by 21 leaders of countries in the Pacific region. Some of the representatives are Hong Kong, Taiwan and China.
The aim of the forum was to discuss ideas about free trade between Pacific regions, quoted from Marketplace, Thursday (16/11/2023).
Over the past few years, China and the US have put up a ‘wall’ on trade through tariffs. China called tariffs on a number of consumer goods from the US “discriminatory.”
One of the things that is likely to be high on the agenda is the trade dispute over semiconductors. The chip war between the US and China is getting hotter with each other blocking components and chip manufacturing tools.
“China spends tens of billions of dollars every year to domesticate the chip industry. In the past, the chip industry was spread across many countries. This has been a catalyst for policy responses from other governments,” said Chris Miller, author of “Chip War.”
“For example, the US has issued a policy restricting exports of advanced chips used to train China’s AI systems,” he added.
The US argued that the blocking was to control the country’s national security, not to maintain economic benefits.
“I think when you talk to government officials, they’re very focused on the security implications of advanced chips and the kinds of AI capabilities that they enable,” Miller said.
“The challenge is that the same chip used to train AI with civilian implications can also be used to train AI with military implications or intelligence applications. There is no way to tell the difference,” he said.
Miller is pessimistic that APEC will bring a joint solution between the US and China. The reason is, the two countries are very competitive and want to dominate the chip market.
This can be seen from Xi Jinping’s ambition to urge China to become self-sufficient in the semiconductor sector. Meanwhile, the US has outlined the importance of increasing domestic chip production.
“While I expect Xi Jinping and Biden’s meeting will produce a lot of press releases making the relationship appear to be improving, the reality is that there is a zero-sum competition here to determine which country will be the world’s technology leader,” Miller said.
“In my opinion, it would be naive to rely on one meeting to defuse deep-rooted competitive dynamics,” he said.
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