High-level technology is designed in the United States. That’s how it is. Both Nvidia, AMD, and Intel have their development institutes in the United States. They patent their technology and steadily move forward into the future.
However, if we look at the fine print, one realizes that the construction of their technology doesn’t take place in the US. At least not at the moment, although there are efforts to achieve supremacy in this aspect for the future.
The United States asserts that its mission to achieve chip supply chain independence will take ten years. Nvidia’s CEO, Jensen Huang, believes this is possible, with the caveat that it could also take up to two decades.
It will take anywhere from 10 to 20 years for American independence to be achieved
In his speech at the New York Times’ DealBook conference (via Bloomberg), Huang stated that Nvidia’s success and its products rely on a myriad of components from various parts of the world, beyond Taiwan’s essential manufacturing hub, home to the semiconductor giant TSMC.
“We are one or two decades away from supply chain independence,” Huang claims. “It’s not really practical until one or two decades from now.”
Last August, President Biden signed into law the CHIPS and Science Act of 2022, a bipartisan legislation investing $53 billion in the American semiconductor industry.
According to Laurie E. Locascio, the director of the National Institute of Standards and Technology, it is estimated that “within a decade […] the United States will manufacture and package the world’s most sophisticated chips.” Ten years is the lower end of Huang’s estimation.
The U.S. Chamber of Commerce (COC) states that while much of the CHIPS Act has focused on the $39 billion semiconductor incentives program, it also contains several other complementary and crucial programs that should be prioritized.
To achieve that, it requires professionals of the highest caliber
The COC asserts that a highly skilled, experienced, and talented workforce is crucial for the semiconductor industry. It cites a recent study from the Semiconductor Industry Association, which suggests that 67,000, or 58%, of the projected new jobs could remain unfilled given the current trajectory.
In September, the Department of Commerce released the final rule implementing the guardrails for national security under the CHIPS Act. It expands a previous provision that prohibits recipients of funds from expanding their semiconductor manufacturing capacity, including wafer production, in concerning foreign countries (such as China) for ten years.
It also restricts beneficiaries from engaging in certain joint research activities or technology licensing with suspicious foreign entities.
Huang also referred to China, where the US has updated export controls to prevent Nvidia’s A800 and H800 chips, manufactured in China, as well as the RTX 4090, from being acquired by companies in the country. Nvidia has developed new chips that comply with the latest restrictions, but the most powerful among them, the H20, has been delayed.
About 25% of Nvidia’s data center revenues come from China. During their recent financial call, it was warned that sales to the Asian nation would decrease significantly in the upcoming quarter.
When asked whether Nvidia should continue doing business with China, Huang responded, “We are a business, and so we try to do business with whoever we can. On the other hand, our national security matters, and our national competitiveness matters.”
