SEMI, a global electronics manufacturing and design industry association, applauded a Senate bill introduced last week (see 2006110038) that would provide funding for the U.S. semiconductor industry. The legislation would help U.S. semiconductor research, increase U.S. competitiveness and bolster national security, SEMI said June 12. It would help the U.S. keep up with foreign competitors that benefit from “robust incentives,” SEMI said. “The lack of a federal U.S. incentive [has helped drive] the location of semiconductor manufacturing facilities overseas,” the group said, calling the bill a “significant step forward.” The Semiconductor Industry Association also praised the measure.
The Commerce Department’s increased restrictions on shipments to military end-users is causing widespread confusion and could cripple exporters struggling to survive during the global COVID-19 pandemic (see 2005010037), industry groups said. The Bureau of Industry and Security's April 28 final rule (see 2004270027), set to take effect June 29, is too complex and was released with “poor” timing and without industry input, the National Customs Brokers & Forwarders Association of America said.
Clete Willems, former White House deputy assistant to the president for international economics, believes the U.S. must convince allies to present a unified front to China on industrial subsidies, censorship and cybersecurity issues. Willems, who is now a lobbyist with Akin Gump, was speaking during a June 12 online program of the Asia Society. When it's just the U.S. arguing for reforms, he said, China can portray it as the U.S. trying to keep China down. But, he said, it might be possible to get China to change, “if we are able to portray them as an international outlier, which I think they are.”
Lawmakers introduced legislation this week to incentivize U.S. semiconductor manufacturing and provide more federal support for research and development. The bill includes refundable investment tax credits, a $10 billion federal match system to match state and local incentives, and the establishment of a new semiconductor program within the Commerce Department.
U.S.-China technology competition and the Trump administration’s restrictions on Huawei have likely dashed the prospects of a phase two trade deal, China experts said. The experts also agreed that the phase one purchase agreements are unlikely to be met, even as the U.S. trade representative continues to tout progress on Chinese purchase commitments (see 2005210036).
Export Compliance Daily is providing readers with some of the top stories for June 1-5 in case you missed them.
The U.S. semiconductor industry is preparing to lobby for billions of dollars in federal funding amid growing U.S. technology competition with China, according to a May 31 report in The Wall Street Journal. The lobbying efforts, outlined in a $37 billion draft proposal by the Semiconductor Industry Association, includes funding for a new U.S. chip factory and increased research subsidies, the report said. The SIA declined to comment.
The Committee on Foreign Investment in the U.S. is increasing scrutiny on transactions involving basic medical supplies and sensitive technologies, trade lawyers said. Companies may also be seeing more CFIUS-related delays and a heavier involvement by political appointees in the CFIUS process as the Trump administration seeks to place more pressure on China, the lawyers said.
The U.S. government decision to increase license requirements for certain foreign exports to Huawei may damage U.S. companies more than Huawei and China, experts said. The same may be true for sanctions being prepared against China for interference with Hong Kong’s autonomy (see 2005220011), the experts said, which may present a large challenge for U.S. businesses. “If the administration follows through on the kinds of threats that they’re talking about … it will have a hugely negative impact on U.S. companies operating there, it will have a hugely negative impact on the people of Hong Kong, and it will have a minuscule effect on China,” said Nicholas Lardy, a Chinese economy expert at the Peterson Institute for International Economics.
Thailand recently increased its import quota for fresh potato imports, creating opportunities for U.S. potato exporters, according to a U.S. Department of Agriculture Foreign Agricultural Service report released May 20. Thailand increased its quota from 52,000 metric tons to 58,400 metric tons for 2020 due to “insufficient supply” for further processing, the report said. The import window for potatoes for chip processing is July 1 to Dec. 31 annually.