USA-CHINA TECHNOLOGY WAR IN HEGEMONY STRUGGLE: SEMICONDUCTORS

Abstract

While its hegemonic power is eradicating, U.S.A perceives China’s rise as a major threat. Because of the essential role semiconductors playing in todays and future industries, controlling semiconductors technology is of key importance in hegemony struggle between both countries.

Like in many other sectors, production of semiconductors has been organized as global value chains. Chip design as the production phase with the highest value added has been concentrated in U.S.A while assembly, test, and packaging as the phase with the lowest value added in China.

China has realized that its high degree of import dependance in semiconductors might be one of the biggest risks in front of its further economic rise and started to pursue plans for technological development. In that respect, in 2015 China declared Made in China 2025 with eager goals set to gain self-sufficiency in semiconductors. It showed the ambition for changing its position in international division of labor and for controlling future technologies with that. In face of this situation, U.S.A started trying to hinder Chinese technological progress, to command fourth industrial revolution and built its hegemony again.