China agreed to work with Japan to enhance practical cooperation in key economic and trade areas, including advances in the semiconductor industry.
The global geopolitical crisis has greatly affected the overall development of technology. The ongoing war between Ukraine and Russia, which is destined to be resolved in several years, has greatly increased the rift between the world’s great military powers. Moreover, the United States has greatly influenced other high-tech nations in Europe and Asia to sideline Russia and China regarding semiconductor cup developments.
China struggles through Japan
The People’s Republic of China has been at odds with the United States over control of global semiconductors for several years. Prior to the Covid-19 pandemic, the Trump administration initiated several measures to deny Chinese technology companies access to semiconductor chips made in the United States among other technologies. As a result, China-based technology companies, including Huawei Technologies Co. access to key technologies from the United States and its allies.
In its defense, the US government cited security reasons, blaming its Chinese counterparts for using their technologies to advance nuclear weapons developments. With China accused of helping Russia evade sanctions imposed by Western countries, US allies have played a role in the White House paper.
In the latest development, Chinese Minister of Commerce Wang Wentao asked the Japanese official to lift restrictions on export control of semiconductor chips. Notably, Wentao described Japan’s semiconductor export control measure as a mistake that seriously violated international economic and trade rules.
The remarks from Wentao to Japanese Trade Minister Yasutoshi Nishimura were made on May 26 at the Asia-Pacific Economic Cooperation (APEC) conference in Detroit. Already, Japan and the Netherlands have played by US rules to sideline Chinese demands on semiconductor chips.
However, the G7 countries led by the United States agreed to de-risk but not secede from China.
As a result, the Chinese Ministry of Commerce’s statement came out on Monday she expressed China is “ready to work with Japan to enhance practical cooperation in major economic and trade areas.”
Developing artificial intelligence as a bigger picture
The huge demand for artificial intelligence and supercomputers has increased the need for advanced semiconductor chips. The high demand for chips is evidenced by the stock market of Nvidia Corporation (NASDAQ:NVDA) which is up more than 166% year-to-date to value about $961.97 billion. In the latest quarterly revenue update, Jensen Huang, founder and CEO of Nvidia, indicated that the company is on its way to ramping up chip production to meet the high demand in the AI market.
The Chinese government also wants to remain highly competitive in the technology industry including the smartphone sector, the development of the 5G network, the digital economy, and artificial intelligence capabilities.
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