America Must Create a Multilateral Semiconductor Supply Chain Security Agreement
The United States, Taiwan, the Netherlands, Korea, and Japan should consider forming a multilateral supply chain tracing and customs agreement to prevent crucial technology from falling into the wrong hands.
As emphasized by the National Defense Science and Technology Strategy (NDSTS), the Department of Defense is looking to expand on “bilateral and multilateral engagements to create new science and technology partnerships with countries that share our values, that create new technologies, and that are committed to protecting technologies from competitors who seek to erode out advantages.” Semiconductor dual-use technology is an area ripe for cooperation and relatively low risk due to the fundamentally globalized nature of the production of semiconductor technology. Given the funding priority of semiconductor technology from the Chips and Science Act and Facilitating American-Built Semiconductors (FABS) Act, the more cooperative mood of the current and former administrations, and the priorities listed in strategic documents, a more coordinated approach to chip production involving key allies and partners that excludes China would secure our supply chains while also providing a safer environment for innovation.
In this increasingly competitive environment between the United States and China, securing critical technologies is vital, and semiconductors are crucial to our national security and economic strength. China’s influence in this sector is growing. With the potential for Beijing to gain a leg up on the rest of the industry, it will be necessary for Washington to leverage all of its advantages to secure the high ground. A cooperative semiconductor agreement between allies is the answer.
Despite the risks, this cooperative environment between allies would recapture the more open and necessary collaborative space that feeds semiconductor development that we risk losing in this new era of increased strategic competition.
After all, necessity is the mother of invention.
Nicholas A. Henderson is the research associate to the Ruger Chair of National Security Economics at the Center for Naval Warfare Studies (CNWS) Strategic and Operational Research Department (SORD) at the U.S. Naval War College. He specializes in Chinese international economic policy and writes on economic warfare and the broader implications of expanding U.S.-Taiwan relations. His current research focuses on the national security implications of U.S. semiconductor policy as well as Russo-Chinese military modernization and force projection.
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