With Secretary of Commerce Raimondo visiting China this weekend, Dr. Roslyn Layton penned an op-ed for the National Security Institute demanding the Biden Administration stop American semiconductor equipment manufacturers from profiting on the Chinese legacy chip sector. Rather than seek new economic cooperation with China, Dr. Layton argues the Secretary should be focused on preventing the sale of some of the world’s most sensitive tech equipment to legacy chipmakers.
The problem is that three American companies – Applied Materials, KLA, and Lam Research – have made billions selling their chipmaking tools, including for legacy chips, to China. Dr. Layton notes:
“As can be documented from public data, these three companies have grown their combined revenues from China by 102% between 2018 and 2022. To focus on just one company, Lam Research’s sales into China alone have tripled since 2018, to reach $5.4 billion last year.”
But we can stop this looming crisis, but only if we play offense and defense:
“On offense, a fair portion of the $39 billion CHIPS Act money currently being appropriated should go to U.S. chipmakers intending to expand the production of legacy chips inside the U.S., not just advanced semiconductors. Even more importantly, the U.S. should impose a presumption of denial standard for all chipmaking technology going to China.”
Earlier this week, CTT Co-Founder Dr. Roslyn Layton and Coalition for a Prosperous America’s Chief Economist Jeff Ferry released the Cash Over Country report exposing how three U.S. toolmakers are boosting dangerous Chinese legacy chipmakers. Make sure to check out the report to learn more about how these three companies are making billions at the risk of U.S. national and economic security.
Read the full op-ed here.