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E-mail Xinhua, October 30, 2024
Visitors take pictures at the booth of Intel during the 2023 China International Fair for Trade in Services (CIFTIS) at China National Convention Center in Beijing, Sept. 4, 2023. [Photo/Xinhua]
The latest move of the United States to curb high-tech investment in China will ultimately backfire, stunting its own growth while jeopardizing the fragile recovery of the global economy.
The U.S. government announced new regulations on Monday that restrict investments in China's semiconductor, AI and quantum technology sectors, effective from January next year.
This move coincided with an announcement on Monday by U.S. semiconductor giant Intel of a $300 million expansion plan of its base in southwestern China, showing once again how Washington's policies contradict with the judgment, choices and interests of American businesses.
For U.S. tech giants like Intel, Apple, Tesla, Nvidia and Qualcomm, China stands as an indispensable market with significant potential to generate profits, which can, in turn, fuel their extensive research and development.
However, these restrictive regulations risk crippling U.S. tech companies in a high-growth, tech-driven market, placing them at a competitive disadvantage globally.
The global semiconductor market is currently in a hard-won recovery, driven in large part by China's strong performance.
According to the latest data from the U.S. Semiconductor Industry Association, China's semiconductor sales surged by 19.2% year on year in August, a contrast to Japan's modest 2% growth and Europe's 9% decline over the same period.
Policymakers in both the United States and China are eagerly looking for a tech revolution to fuel sustained economic growth. However, isolating from the world's second-largest economy will take a heavy toll on U.S. tech firms that are at the forefront of such a revolution.
Moreover, this approach starkly contradicts market economy principles and fair competition, going against U.S. President Joe Biden's assurances that his administration is not pushing for an agenda of "decoupling" from China.
The U.S. anxiety over losing its technological edge is understandable. However, dimming the lights of others will not enhance its own standing. Similarly, regarding China as a "strategic rival" and wielding trade and investment as a weapon to advance a politically charged, ideologically biased agenda will lead to a scenario with no winners.
The entrepreneurial spirit that once propelled the United States to greatness is also crucial to the country's future success. It would be advisable for the U.S. government to heed the voices of businesses rather than placing obstacles on their path.
