Semiconductors are fresh oil. CIA warns technological giants of the hazard of Taiwan being lost

Silicon Valley has a powerful problem, and its name is simply a complete dependence on Taiwan.

According to an extended investigation of The fresh York Times, the heads of the largest American technological giants, including Tim Cook, participated in secret meetings with the CIA. The goal was one: to make the manufacture aware that by 2027 China could make a decision towards the island, and the failure of its factories would have meant a massive shock to the global economy.

The information reached by The fresh York Times sheds a completely fresh light on the relation between the American administration and the leaders of the tech sector. In July 2023, a secret gathering was held in a specially secured area in Silicon Valley. At the request of the then Secretary of Commerce, Gina Raimondo, CIA manager William Burns provided the latest intelligence on China's military plans.

Among the listeners were the most crucial players in the semiconductor market: Jensen Huang (CEO Nvidii), Lisa Su (CEO AMD), Cristiano Amon (CEO Qualcomm) and Apple head Tim Cook. The message was clear: according to intelligence, Xi Jinping's troops are to be ready for a possible Taiwan seizure in 2027. According to the coverage of the participants of this meeting, Tim Cook was to privately admit to officials that due to this information he was sleeping with “one open eye”.

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Dependency valued at $10 trillion

The concerns of the American administration are justified. planet technology is simply a hostage to 1 company – Taiwan Semiconductor Manufacturing Company (TSMC). That's where about 90 percent of the world's most advanced chips are made. For Apple, the problem is peculiarly burning – the full Apple Silicon circuit line, driving modern iPhones, iPads and Mac computers, is created exclusively in Taiwanese factories and the Cupertino giant has no real alternate at the moment.

According to a confidential study of 2022, the failure of access to the Taiwanese supply chain would have caused the biggest economical crisis since the large Depression, causing the US's GDP to fall by 11 percent. In turn, Bloomberg's analysis of early 2024 estimates that a possible conflict around the island would cost a global astronomical economy over $10 trillion. Today, chips, not oil, are the most strategical natural material in the world.

Difficult and costly evacuation

However, independency from Taiwan is not just a substance of desire. Construction of a modern semiconductor mill is simply a gigantic engineering challenge that usually lasts from 5 to 8 years and costs respective twelve billion dollars.

Still, White House He has long been pushing technological giants to diversify production. That is why the CHIPS Act was passed in the United States, pumping $50 billion into the improvement of home factories. However, the manufacture was initially very resistant due to the costs – chips produced in the US are more than 25 percent more costly than those from Taiwan, and the emerging factories in Arizona are inactive technologically giving way to the home market.

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Tim Cook, however, took the glove. He declared investments of tens of billions of dollars in the United States to support the TSMC and another producers. Interestingly, according to manufacture reports, Apple besides began intensive discussions with Intel to measure its production capacity as a strategical plan ‘B’. In turn, the TSMC itself committed to investing in the US at $165 billion, planning to build more factories.

Silicon shield and global race

Moving production is simply a process scheduled for years, and Taiwan itself does not make it easy. The government there consistently maintains the most technologically advanced production on the island, as analysts describe as a strategy of a "silicon shield" – it is intended to make the state so irreplaceable for the global economy that the powers gotta defend it against anyone's invasion. Not just China.

However, this problem has been seen worldwide, and no 1 wants to passively wait for developments. We see akin safety measures in Europe, where, under initiatives specified as the European Chips Act, EU countries pump billions of euros into local semiconductor production. The consequence is powerful, planned investments specified as Intel's plants in Germany or the TSMC plant in Dresden.

As the past of fresh years has shown, arguments about common economical interdependence do not always hold back military urges. Therefore, the Western technological planet has no way out – it has to build at an accelerated pace productionheads outside Asia before 2027 becomes a violent reality. but we'll have 2027 in 10 months. Never managed to build an advanced semiconductor mill in specified a short time. Anyone.

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