TECHNOLOGY RACEU.S.-China Tech Rivalry: The Geopolitics of Semiconductors
The United States and China are locked in a high‑stakes contest for dominance in computing power. In response to US sanctions and export controls, China has ramped domestic chip design and manufacturing, aiming to create an all‑Chinese semiconductor supply chain that reduces dependence on foreign technologies.
The US–China chip war has only grown fiercer amid trade tensions and shifting policies. While the United States seeks to limit China’s role in the world’s chip supply network, China has been working intensively to cut its dependence on overseas semiconductor technologies and boost domestic chip manufacturing capabilities. China aims to “build an all-Chinese supply chain” regarding semiconductor production as part of its broader strategy to attain technological supremacy.[1]
The ongoing conflict highlights the growing ‘weaponization’ of semiconductor supply chains, as both nations employ economic statecraft through sanctions, tariffs and export controls, with significant ripple effects across the global supply chains. This brief analyses the semiconductor strategy adopted by the United States between 2017 and 2025, encompassing the first Trump administration, the Biden administration, and the current second Trump administration, focusing on China’s strategic responses to these policy shifts and highlighting some of the broader implications.
US’ Semiconductor Strategy
The most disruptive challenge to the US leadership position in semiconductors has come from China, whose aggressive state-led industrial policies and heavy subsidies aim to achieve self-sufficiency and global competitiveness. China, having a vast reserve of rare earth and being its most prominent exporter, aims to become a dominant semiconductor manufacturer worldwide, which has strained US–China ties in recent years. This rise triggered a fundamental shift in US semiconductor policy. The current US semiconductor policy has broadly two goals vis-à-vis China. First, it seeks to establish a secure supply chain and increase domestic manufacturing. Second, it aims to reduce China’s dominance in the global supply chains of chips so that China can no longer threaten US tech superiority.[2]
Securing the Supply Chain
During his first term, President Donald Trump took several significant steps to secure the US semiconductor supply chain and boost domestic manufacturing as part of his broader ‘America First’ economic and national security agenda.[3] The Trump administration also laid early groundwork for what would later become the Chips for America Act in 2020, pushing Congress for funding to support domestic semiconductor manufacturing and research. The administration also tried to bring major semiconductor producers, such as TSMC, the world’s top contract chipmaker, into establishing facilities in the United States. This effort paid off in 2020, when TSMC announced a US$ 12 billion investment to build a fabrication facility in Arizona.
The Biden administration intensified the chip war, expanding the scope and scale of export controls and sanctions. Biden applied the small yard,
