Underestimating China

Thomas Friedman latest column in the NYTimes:

 I used to worry that Xi’s big idea — “Made in China 2025,” his plan to dominate all the new 21st-century technologies — would leave the West in the dust. But I worry a little less now. I have great respect for China’s manufacturing prowess. Its homegrown chip industry is still good enough to do a lot of serious innovation, supercomputing, and machine learning.

But the biggest thing you learn from studying the chip industry is that all its most advanced technologies today are so complex — requiring so many inputs and super-sophisticated equipment — that no one has the best of every category, so you need a lot of trusted partners.

And if China thinks it can get around that by seizing Taiwan just to get hold of TSMC, that would be a fool’s errand. Many of the key machines and chemicals TSMC uses to make chips are from America and the European Union, and that flow would immediately be shut down.

Nope, you can’t make the best chips in the world today without silicon or trusted partners. And everything that Xi is doing — from Australia to Taiwan to Jack Ma — is driving them away. As one U.S. chip executive said to me of Xi, “The Chinese have replicated and mimicked,” but they have never created the kind of ecosystem like TSMC’s, “because there is no trust.”

It seems to me incredible that for the NYT - the most serious paper in the world - the Chinese are incapable of outcompeting INTEL and TSMC because the Chinese have no trust and cannot have trusted partners. The Chinese, he quotes, have replicated and mimicked, but have never created...". What an imbecility! It is almost racist...  One has only look at China 2021 (or better, to Chinese robots on the moon and Mars) to understand Chinese capabilities. To write that they cannot do it because they are untrustable is nonsense. It only points to the desperation of the American and world industry. Not long ago, the same was said about the Japanese, till they destroyed American electronic, photographic and auto industries.

I am not happy about the Chinese destroying INTEL but any action must be based on truth and reality, hard as may be, and never on racist phantasies.