Taiwan produces 92% of the world’s nano-chips, and China is struggling to catch up.
The United States is gaining ground on China regarding the manufacturing of nano-chips. This technology is necessary to power modern digital hardware as well as advanced military equipment. And, as China hopes to challenge the American hegemony, they will need to solve the nano-chips issue first.
At the moment, the vast majority of nano-chips are produced in East Asia. Specifically, the autonomous island of Taiwan holds 92% of the overall manufacturing, also thanks to their advanced equipment.
The rest is produced in South Korea, where the chips industry is dominated by Samsung.
Both South Korea and Taiwan are close allies to the United States, who also provides the blueprints and the advanced equipment to build nano-chips.
Thanks to this alliance, Taiwan and South Korea are able to produce 3-nanometer chips, with plans of producing 2-nanometer ones by 2025. By comparison, the average width of a human hair is between 17.000 and 180.000 nanometers.
The United States provides Taiwan and South Korea with extreme ultraviolet lithography machines, equipment necessary for manufacturing such minute devices.
China too has been trying to enter the chips competition. Its SMIC (Semiconductor Industry in China), however, is roughly five years behind their Taiwanese and Korean equivalents. In particular, they are now starting to manufacture 7-nanometer chips, products that Taiwan started making in 2018.
The confrontation with the United States
Part of the reason why China is lagging behind in chip manufacturing is the United States’ isolationist policies against Beijing.
Those same extreme ultraviolet machines are not supplied to China, which has to build chips with less advanced equipment. Further, the Biden administration has passed a bill forbidding American companies from spilling over industrial secrets to China.
This prevents private corporations like Nvidia from partnering with Chinese firms, forcing them to keep relying on Taiwan and South Korea for their chips.
Being behind on chips technology means that China will not be able to invade Taiwan until they catch up. Taiwan provides China the chips they need for advanced military equipment, and an invasion would cut it short.
Meanwhile, China would have to face the American army, whose technological advancement is unparalleled.
According to CNBC, experts believe China will close the gap in 10 to 15 years. By then, however, China’s median age is projected to reach 45 years old. A nation possibly too old to engage in a foreign invasion, let alone a World War.
For comparison, the American average age is projected to reach 40 years old only in 2050, therefore its population will be way younger than China’s.
In short, China does not have much time to invade Taiwan. On the other hand, however, its underdevelopment in chip manufacturing prevents it from such an attack.
