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May 14, 2019, Tokyo, Japan - Japan's computer giant Fujitsu unveils a 300mm wafer which has the CPU chips with 48-core and 2-assistant core Arm architecture "A64FX" processor at Fujitsu's high-tech exhibition Fujitsu Forum 2019 in Tokyo on Tuesday, May 14, 2019. Fujitsu and Riken are developing the government-backed next generation supercomputer called Post-K computer, 100 times greater performance of K computer.    (Photo by Yoshio Tsunoda/AFLO) No Use China. No Use Taiwan. No Use Korea. No Use Japan.
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Maintaining China’s dependence on democracies for advanced computer chips

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Executive summary

Learn more about Global ChinaThe Chinese government is investing tens of billions of dollars in its computer chip factories and may eventually achieve global state-of-the-art manufacturing capabilities. However, China can succeed only if the United States, Japan, and the Netherlands continue to sell it the manufacturing equipment necessary to operate its chip factories. If these states deny access to this specialized equipment, China would find it nearly impossible to develop or maintain advanced chip factories for the foreseeable future. Countering the Chinese government’s market-distorting subsidies with such export controls would shift chip factory capacity to democracies, especially the United States, Taiwan, and South Korea. As a result, the firms making specialized manufacturing equipment for chips would experience little to no long-term revenue loss from such export controls, and may even benefit from working with more reliable partners in these democracies.

Saif M. Khan

Research Fellow - Center for Security and Emerging Technology, Georgetown University

It is in the security interests of democratic states, including the United States, for China to remain reliant on democracies for state-of-the-art chips. Advanced weapons systems and many emerging technologies for surveillance and oppression depend on state-of-the-art chips — currently produced only by firms in the United States, Taiwan, and South Korea. Maintaining exclusive control of these chips will allow democracies to implement targeted end-use and end-user export controls on them, largely preempting China’s development and use of many dangerous or destabilizing technologies.

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