Ahead of the inauguration of President-elect Joe Biden, China Tech Threat founder Roslyn Layton joined Bonnie Glaser and Jim Lewis on the Center for Strategic and International Studies’ (CSIS) ChinaPower podcast. Ms. Glaser is the senior advisor for Asia at CSIS and host of the ChinaPower podcast. Dr. Lewis is senior vice president and director of the Strategic Technologies Program at CSIS.
China’s ambitions to dominate the global tech markets, coupled with its Military-Civil Fusion strategy, present a unique challenge to U.S. policymakers. Chief among those, notes Ms. Glaser, is striking the right balance between protecting dual-use technologies and fostering continued demand for American-made products, which will help continue to drive innovation.
Despite controls on semiconductors and semiconductor manufacturing equipment (SME), U.S.-born products are continuing to reach Chinese military end users, Dr. Layton points out.
“Semiconductor firms today, like Applied Material, KLA, or LAM Research, are actively selling advanced technologies to Chinese companies which have links to the Chinese military, like YMTC and CXMT. They are not going to stop until the Department of Commerce steps in and says this is a problem,” Dr. Layton says. “We the people, through Congress, empower these agencies to do that.”
Multilateral trade agreements, like the Wassenaar Arrangement, are meant to curb the flow of sensitive dual-use technologies, points out Dr. Lewis, who was involved in the formation of Wassenaar. Those types of trade agreements provide a starting point to identify technologies that need to be controlled, but it is important that policies evolve as quickly as technologies.
Citing her recent report, “Policy Review of Semiconductor Manufacturing Equipment: The Art of Balancing Economic and National Security,” Dr. Layton notes discusses the importance of supporting U.S. tech makers. ““We cannot destroy enterprise, but we shouldn’t willingly engage with military actors when we have the intelligence that’s shows we should not be sharing our advanced technology.”
Turning to the transfer of power in Washington, the participants agree that the incoming Biden administration will likely restore more normalized relations with China—but that it would be a mistake to completely undo the Trump administration’s hardline approach.
This important conversation highlighted some key action that has already been taken in this area, but also shows there is still more that can be done to prevent sensitive dual-use technologies from falling into the hands of our adversaries.