April 23, 2024

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Our world runs on semiconductors. The slivers of silicon provide electronic brains to phones, computers, cars, data centres, and stock markets. They’re also the digital backbone of modern militaries. 

Some of the first chips ever made were used in missile guidance systems. Today, they power countless military devices, from fighter jets and howitzers to radios and radar.

In the Russian-Ukraine war, chips power HIMARS rocket launchers, Javelin anti-tank missiles, and the Starlink communications satellites. They’re also integral to the arms race underway in East Asia, where territorial disputes in the East and South China Seas risk spiralling into a major conflict. The rise of artificial intelligence adds another dimension to the tensions: there’s now a dearth of AI chips.

In the EU, the shortages and frictions have led the bloc to introduce the €43bn Chips Act. The investment package aims to boost local production and reduce international dependencies. Experts, however, have downplayed any prospects of sovereignty.

According to Chris Miller, the author of Chip War, the EU has “no chance” of semiconductor independence — and neither does anybody else.

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The problem, he argues, is that the supply chain is simply too globalised and interconnected.

“Independence is hopeless,” Miller, an economic historian, told TNW at the IFA Berlin tech show. “It’s not going to happen — nor do I think Europe is pushing for it.”

A divided industry

In Chip War, Miller recounts the decades-long battle to control semiconductors, which today centres on the rivalry between the US and China. Tensions between the nations have torn the chip world into two.

As the fractures widen, Beijing is trying to bolster self-sufficiency in semiconductors.  It’s currently the world’s largest importer of the devices, spending more money importing them than it does on oil.

A portrait photo of Chris Miller, the author of Chip War