tv Inside Story Al Jazeera July 3, 2023 2:30pm-3:01pm AST
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the discipline record in poland. the accused judges who refused to the states line. witnesses follows to courageous judges spear heading the stand against reforms. critics, please leave the highest guardians of the constitution, vulnerable to politically motivated sanctions, based on the routing, the judges under pressure on that, just either the with us government says enforcing new restrictions on exports of semiconductors, of china. beijing says the united states is behind the move. so how will this impact china as high tech competitions? could it prevent the countries from developing its own chip industry? this is inside story, the
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other welcome to the program. i'm adrian sending a semi conductor chips are a vital component to and everything from smartphones to cause and even ministry hardware. china has been looking to insure it supplies, but it's now facing a major problem. the netherlands is coping exports of a central technology used to manufacture the most advanced chips. china says it's part of a campaign by the us to undermine its economy. we'll go to a panel in just a few moments, but 1st a report from sent them on. china is tech admissions, have hit a roadblock. it's been building up its semi conductor sector, making computer chips that are vital to its economy and military plans. but new rules and the netherlands could to private of a central technology needs to make the most advanced chips as the does trade minister said the restrictions were imposed on national security grounds without mentioning any country. but china believes the u. s. is behind the move on you can
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send thing may fall. so help with china has always opposed the us generalization of the concept of national security. abuse of export controls and using various excuses to control or collect other countries to engage in science and technology blockade against china with the mattress. do us impose sweeping restrictions on semi conductor exports to china during the past year. president joe biden says the move aren't aimed at china is call to me, but at the top military technology that threatens the interest of the us and its allies. at the same time, washington is investing billions of dollars and building up its own domestic chip plants. growing high tech rivalry between the us and china, shaking your global supply chains and pressure appears to be growing on key players to take sides bids monahan how to 0
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so let's bring it, i guess for today's discussion from brussels, we're joined by steven. oh, i got who is the chief diplomatic correspond to the new or for the new york times from townsend wisconsin. as emily benson director of the project on trade and technology at the center for strategic and international studies, added brisbin were joined by work powell as a professor at queensland university of technology, a warm welcome to you. we'll work. let's start with you. the top government says that it introduce this legislation due to the national security concerns. all those concerns legit to those didn't come to those conclusions independently. because the place all of these in to pull the frame, the frame is basically a pronouncement by and by princes and by the in early march, 2021. when he made it very clear that from his point of view, china was not going to become the wealthiest or the leading nation in the world on,
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excuse, watch. as part of the acid, there has been a full court press, progressively thing designed and mounted to cut a tile, thomas ability to pose a risk on that particular calculus. the result is that the, you have the time to view the hard technology was a critical piece of the jigsaw puzzle. under control, time has rise and its ability to challenge the appeal, the, the position of the us as a leader in the world. it had to stop to mobilize these allies to implement the full corporate office. and this is exactly what's happening right now. and it's on surprise me that it's your opinion allies are progressively from the beginning of the line. i really would you, would you agree with that, but that this has much to do with with what do you as president job i have been set about trying to not to passing the us to become a global leader on,
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on his watch that this decision by the dutch government a is ultimately being decided somehow behind the scenes by the us. ok. thank you very much for that question and i think it's a great one. i think the, the only difference i would point out is that a lot of the efforts to control not only e u, v, but the less advanced d, you, me, d, u, v. machines from the netherlands to china actually began in the previous administration . and that's important context because it really does show an absolution of us policy to regard china increasingly as a threat unless as a customer. that is largely in effect of the pursuit of civil military fusion and china, which increasingly blurs the line between what is primarily a civilian good and one that is primarily a military good. i understand that the united states providing sufficient intelligence to the dots government to convince them, but it really was a matter of national security to control the u. v. machines. and furthermore,
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countries like japan, the mother lens and even south korea have really had it with ip that's when it comes to high attack. and so i think it was the perfect confluence of factors leading to these additional controls. okay, well, we'll get into what these machines actually are and what they do and just above it but, but 1st step and what do you make all of this? that must be some legitimate security concerns when you call and have a potential advisory in possession of technology. that they ultimately be used against you can do well, that's a bad idea. certainly. i mean, i'm also struck by this notion that somehow you of 27 new york in countries of no agency at all, which is absurd. the bottom inspection is struggling to get you to go along with it on china. it's not always going very well for reasons that we've all discussed and europeans interests are not the same as the american interests. but it is also true
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that in general york and government see those rach, a chinese technological espionage and it's do we use production as dangerous, less dangerous to them? and so yes, the us may be pushing, but they're pushing on an increasingly open door for it. well, other countries now follow the docs lead or feel pressure to do so. of god fully expect that the european transatlantic allies of the united states to ultimately fold into line. it is true that each nation will come on to these decisions in pop on their, on, but they don't do that outside of context. and the fact of the matter is that there
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is a consistent pattern of behavior from european governments. and that is initially a bit of pushback on various things, a little bit of weighing around on various factors, but ultimately they fall into line. and i think that from the us as point of view, there is a strong expectation that push comes to shove, the trans atlantic outlines will ultimately do what they asked to do. and we're going to start to see that happening all the time. i think that that is going to be a surprise to anybody if the portal of quality or p and countries into a into, into a bit of a pickle. because frankly, we've got on the one hand, a full study pushing them to do something that creates tensions. with the come see the result, the european nations, a real excited kimberly, dependent upon for a whole bunch of other economic transactions and benefits as well. i guess these are really contradictions about times if you will. and europe,
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in this particular case happens to be a, you know, right in the middle, local, emily, where does this leave a trade policy or? well, it's interesting, if you look at the you academic security strategy document that came out, i believe last tuesday, that actually outlines button in september. they will significantly update their dual use list of goods. and this will free seat, of course, a potential outbound investment screening mechanism. in december, so whether or not another one's reach to this of the final outcome completely independently. it is indeed forcing the europeans to update their toy use list. another factor here, of course, is that most countries export controls are tied to a more camp lateral regime, which has been bosner arrangement. russia is a member of that consensus based organization. and its membership has precluded the
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update of any high tech goods. the last couple of cycles. and so either way, countries and unions like europe are having to really contend with how they go about updating regulations. and although this could have come about differently from a diplomatic standpoint, i think we will see greater policy convergence over time. steven is the most you countries the, the merits and legislations like this. i understand the reasoning behind it or is that a feeling to a certain extent that that being pushed around here by, by the us. i think it's a bit of both. frankly. i mean, yes, the us is pushing no question. that's also true. this bunch company has taken care of the sophisticated and its products of particularly desirous objects. sullivan keeps talking. the us national security adviser keeps talking about the risk and from china. one can define what that means, i think for some europeans,
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when he says, we want a small garden with high walls, they think the garden will be the size of texas, but they do understand that helping. she's in thing, do more quickly what she's in thing says he's going to do. which has to make china capable of invading taiwan by 2027 and becoming the world superpower by 2050. may not be in the herb's best interest. now. it's also true. europe has great trade with china. there's lots of things to do with china. there's climate. the interests of europe are not exactly the same as the united states. suddenly in europe, doesn't see china as a pure rival. the way the us does in europe doesn't count the same exact pacific in the pacific interest, though, europe does have some in the pacific interest. so i think the new china is getting
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darker. it's partly she's in things faults because he's been much too explicit in, in some people's minds about china ambitions. the intent is not to curtail china from growing the intent is to prevent the chinese military from getting the technological advantage through trade. a statement that drugs that, that's impossible, isn't it in, in, in the long term. i mean, it would, china is, is gonna somehow circumvent this band if, if it can't produce the technology itself, ultimately, if it con, purchase rather the technology elsewhere, ultimately it's gonna, it's got a lot to produce the technology itself. it can, it will perhaps, but it's proven very difficult. and if you look at the chips work in taiwan, if you look at this dutch company, these are not easily wrapped. a couple of things though, china is trying,
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i'm trying to, we'll try in china at some point will succeed china's, you know, look, i mean, it's took a long time for them to build a jet airplane that works well to be a big passenger draft. they're fighters, slow, pretty much like stolen copies of american fighters. so china is busy, china's smart people are smart, they'll get there. but the whole point is that nonsense doesn't want to make it easier on them to get their work with without getting to technical here. what sort of equipment we actually talking about here, middle talking about sending conductors themselves. we're talking about machines that help to produce semiconductors. is that right? no, that's right. and um, and the fact the matter is that in terms of must be latree applications. some of the ships that are used readily available and many truck trouble anyway,
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so that whole issue is largely a foot of the in terms of military applications. today. i'll go back to what i originally said, and that is that the us post job that is shaping this entire um, um, but public policy approach and reorientation around technology and try and policy is driven by a broad sweeping. i'm be sure to ensure that china does not become the leading nation in the world under jerry bottoms. watch the bottom light, the very, very clear. it's got nothing to do is taiwan 2027. a lot of things that, that he is doing literally. and he's also quoting woods and the miles of people who haven't actually set that mean fact, general milligan, i think today or yesterday, my the oldest advice and that he himself couldn't read. you know, i, president, she didn't things bought in terms of the any could split dates for anything
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a whole. so i didn't buy that as the cool proposition he bought is on the right. cool. but he's that america does have a view that china is actually up to it. and it is a challenge it to it in a very systematic sense. the or pans also say john or it's a systematic getting that challenge. and that is becoming more and more pronounced in terms of some of the, the language you use by different european leaders in this particular space as well . so i think we all got to say policy convergence in a trans atlantic sense. the. ready of the differences in interest, i think i genuinely way, but nonetheless, i think that the europeans will ultimately fall into line to some extent that they cost, but they will full full into line and um, and behave like, like the good, you know, our trans atlantic that lives that the us expects them to be
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a part good work of it. to what extent are they on a hiding to nothing by not his is european allies. i mean, joe, by themselves, could be out of a job within 18 months, and it is only a matter of time. surely before china achieves it's ambitions, it's an unstoppable tied, isn't it? predicting the future. it's very difficult thing. and uh, like, uh, my, my, my colleagues here on the shirts, and i think there is an expectation that even improbability. but the chinese endeavors in this arena will ultimately pay for the real question is how long will that take and what, what the impact of that delay is likely to be on the old range of calculations. and i've tried to, has proven its ability so both emulate technologies as well as in invited significantly. it's so but you know, when it was denied an opportunity to participate in the spice stations program and
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ultimately embarked on signing initiatives to some success. so i think that it is a reasonable working assumption that at some point in the not too distant future, you know, whether it's through use 5 years or 7, or 8 or 9 use that these technologies will ultimately be within the capacity of the chinese scientific and engineering well, emily, china is obviously a that a little cold, but the law abuse of export control measures that seriously disrupt free trade and international trade rules with verizon. well, i think what's interesting about the current trilateral arrangement or series of unilateral controls, if you want to think of it a little differently, is that they are not a complete embargo. these are designed to exercise existing cho coins over very high tech parts of this on the conductor supply chain. there are many
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countries who participate throughout the supply chain, malaysia, south korea, only a couple of countries really have these viable to points over the most advanced chips. those are the united states, the other ones and japan. what's interesting about the adults controls is that they're similar to the japanese list of 23 items and not their country agnostic. and so these 2 governments have gone out of their way to say this isn't about china . this is about taking extra preventive measures to make sure that our most advanced technology is not getting into the wrong hands. and so while i can see that china would be frustrated with the expansion of controls. but another one's has had to walk a very fine line between the united states and china. and this is a dynamic that is unlikely to change. under a change of administration, we will consent to continue to see close trading partners having to make tough
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decisions. and again, i think the other ones here has done what it can and also taking extra steps to make sure that the european commission is able to lift these regulations and make fun of applicable to the 27 members states. saving would, would, would you agree with this? what does this mean for, for global trade rules? are they going to have to be rewritten now? because the u. s. takes a dim view of certain products getting into chinese homes. well, the w 2 has been in trouble for quite a long time. partly it's washington news problem and partly it's washington's problems with way to china. but i think the w t o is an institution that is barely, a lot of people are not paying as much attention to it as perhaps they should, which is a big problem for the european union, which lives by, you know, quite,
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quite nicely rightly international rules and and norms, but if you look at a lot of the button administrations national industrial policy, which is somewhat new, it doesn't pay much attention to w t o rules. of course that always argues that china is manipulating those, those rules, etc, etc. and there's always blame being thrown around, but to your point, i do think the w t o is an institution of declining importance. i'm not saying that's bad or good. it's just the fact i'll come back to, to work and just a moment for us at the end of emily, this seems like your, your ballpark. would you agree with that? i think there are a couple of different factors that play. i would agree, but there are provisions i've been placed on reduction act, for example, that directly contravene the core objectives of the wto. they are quite clearly
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illegal. however, to defend the united states in this particular instance of export controls. the w t o has never sufficiently dealt with issues of national security and investment security. anything the funds related has really been housed elsewhere in the united states that play a vital role in standing up this 40 to member coalition in the boston are region. and that is the multi lateral funding to promulgate controls. like i said earlier, because of russia's membership in that institution updating it has been essentially impossible. and it is now to found that does a lot of questions about lackluster performance of the re, to an ongoing desire to multilateral was where possible. this increased and fusion of national security in the economic policy meeting. we probably do need to look at the institutions we have and revitalize them. and that's why i'm particularly optimistic about the potential expansion of the g 7. i think from that baseline we
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can build something that's a little bit more um, a little bit better suited to today's environment. steven, i, i see you knowing that and yeah, no, i think, but at least i makes it more of a sense to me. i mean, the world is shifting, you're getting more rivalry or getting regional rivalry is the, this notion that we're all going to have free trade and then somehow separated from serious national security issues, let alone what about and calls a foreign policy for the middle class. makes it a much more competitive world, and frankly, a more protection as world i mean, the european union likes to talk about resilience. other people would call that protectionism back and forth. i mean, one word is roughly the same as as the other one. the big question is how
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big a garden are you gonna wall off? and i think that's the big question. when there's less underlying talks about the risking, she's talking about not being overly reliant on any one country, but sometimes that means china for a teen materials. but even though, if you take that too far, you end up with as a very real kind of a tech support protectionism that's border controls, important controls. and that's where that's, that's where we're headed, i'm afraid. um, so i think what emily's saying makes tremendous sense to me. busy feel free to comment on that point if, if you want, but this dutch legislation didn't mention any particular company in particular, but of course benevolence. this is home to m. s l one of the, the most important semi conduct the companies in the world. i mean, what does this mean for that bottom line?
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how big a customer for them is china as well when people filter those because um they would have been banking on um, having the sales you know, into the, into the ford projections in terms of the pre. and i also no doubt, but as cfo is now scratching around to try and figure out how they going to square the circle and make sure that the sufficient are and the resources and those sorts of things to, to, to take the, take the company fold up but i'll touch on this, this broad question of try that was done was with rather than that a. so i think that there is a shift, obviously in the configuration of the, the consumers of global trade. the question of the national security has become more prominent. we don't know what that means in terms of how the w to your ultimate lee would triggered that. and, and i think that the, the ultimately going to be a need to get a great,
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a clarity around what the issues actually main from i think it is a challenge ultimately for your life. because the us has, it's for quite some time bidding reshaping a much more protectionist approach to one way 80 stands in the world. and it's mainly for bryce and your favorite is actually on the industrial part of the landscape of the european union and the aggressive policies that the bottom destruction in particular has implemented in terms of lowering technology companies. a lot of the companies to the, to north america, having an impact on, on europe, is starting to play on the minds of corporate within europe in terms of whether or not they remain domiciled in a high cost. environmental will take advantage of subsidies in north america. these aren't going to be the challenges that will,
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that will create fractures between european they cannot make it easy for us. and the broad uh, so the security interest of the transatlantic alliance and everything. but you would you agree with that? i mean, at work said the, the a, a m s. all is sort of its own helpful for the bottom line. good. all the industries and technologies now find themselves subject to similar legislation elsewhere. yeah, i think that's a great question. i mean, these control will head not only as small but also have some i and so you're looking at the 2 major dodge players in the sector. another great question is one that peter wondering does he of animal has brought up several times, which is to suggest this really won't affect their bottom line too much because they already have a significant amount of backorders. and alternative marketplace is, however, a bottom turn back to the question, if you can't solve the china to soon, can you? so who is willing to pay and able to pay for these machines that can run up to
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$300000000.00 per machine. so that will be very contingent upon the united states to help if i was to figure out where is a safe trust, your trading partner. i mean, i'm sorry, sorry to cut you off with with almost out of time statement. very, very quick for from you just just to end well simply to say, but the tensions between europe and the united states on trade are increasing. they will increase, but your opinions to worry about this also understand that if they're worried about donald trump becoming president again, they need to not undermine joe biden when he tries to create jobs for white, middle class american voters, manufacturing data to your or stevens, along the emily events and the, and work power. so being with us. so today, much appreciated. and as always thank you for watching. you can see the program
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again at any time by going to the website of ours is 0 dot com for further discussion. join us a facebook page on facebook dot com forward slash h a inside story. out of course you can join the conversation on twitter handle at a j inside story from me, adrian said again for the team here. and so how, thanks for being with us. we'll see again the the investigative journalism is a very natalia is guy and it would have been absolutely impossible to offer any like that before global exploits in discussion. the internet did not need to be the
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