After World War II, Great Britain was in financial trouble. Society was in need of reconstruction, but the war had eaten up the currency reserves. Exports were needed to get the country back on its feet.
The Labor Party, which came to power in Great Britain, decided to patch up the state coffers by putting the crown jewels of British aviation technology, the jet engines manufactured by Rolls-Royce, on the sales list. Machines that were previously strictly controlled by the British were ready to be sold even to the Soviet Union.
Although the Soviet Union had fought on the same side in the war that had just ended, it was perceived in the West as a potential threat. Even a Soviet dictator Joseph Stalin is said to have wondered why the British would sell them their secrets.
In Great Britain too, the sale of jet engines gave rise to a debate in which safety concerns and trade policy were at odds. However, the Soviet Union had timber and grain, of which Great Britain was in short supply. There was a trade to be made.
The first Rolls-Royce jet engines were sent to the Soviet Union in March 1947. The British condition was that the engines go for commercial use. Their military use was prohibited.
When jet engines arrived in the Soviet Union, they were immediately dismantled. Soviet aeronautical engineers immediately began copying Rolls-Royce operational solutions for their own military purposes.
Great Britain’s trade policy solution turned into a security policy mistake in 1950, when the Soviet-made MiG-15 jet fighter appeared on the scene of the Korean War. Klimov VK-1 jet engines developed from Rolls-Royce engines made the MiG-15 a superior fighter compared to the first Lockheed P-80 and Gloster Meteor jet fighters of the western forces.
Only the US Air Force F-86 Sabers could offer resistance to the MiG-15, which had forced US Air Force bomber squadrons to remain grounded during the decisive moments of the war.
History might be different if Britain had maintained export restrictions on jet engines. Maybe there wouldn’t be a country called North Korea.
The United States criticizes China’s possibilities for advanced chip production
In recent months, the tensions between trade policy and security policy have once again risen to the stage of great power politics. Now the parties are the United States and China, the subject of export restrictions is semiconductor technology, and the battlefield is data centers and artificial intelligence systems.
In the fall, the United States announced that it would limit the export of semiconductors and artificial intelligence-related technology to China. It was a significant change from the US’s previous market-driven policy.
Until now, the restrictions on the most advanced microchips have been for military use. This has not stopped China’s armed forces from getting powerful chips, as the technology trickles down to the military through private companies. In the same way that jet engines sold to build passenger planes ended up in fighter jets, components sold to Chinese grid companies may end up in government surveillance systems.
In September, the president Joe Biden the administration announced that it would prevent American companies from selling high-performance microcircuits to China. The ban applies to semiconductors suitable for parallel operation, which are used, for example, in supercomputers or running large artificial intelligence systems. The restrictions therefore do not apply to individual powerful chips in, for example, game consoles or smartphones.
The export ban was praised, but it was also feared that it would backfire. In isolation, China would be forced to develop its own chip production, which is suddenly in demand. In the short term, China would fall behind the United States and other Western countries in terms of development, but in the longer term, it would catch up and perhaps pass.
China is currently the third largest semiconductor manufacturer in the world, right after South Korea and Taiwan. The share of Chinese chip production in the global supply is about 16 percent. However, it relies on older technology chips.
China is estimated to be about four years behind the leading edge in the production of highly efficient semiconductors. It is roughly the same amount as the Soviet Union was estimated to be behind Western countries in the development of jet engines before the sale of Rolls-Royce engines.
To ensure that the UK’s mistake does not materialize, the US administration also refined export restrictions on semiconductor technology in October. The new policy made it clear that the United States not only wants to prevent China from acquiring the most efficient microcircuits, it wants to deprive China of all opportunities to develop its own chip production.
In addition to efficient microchips, export restrictions were placed on the software used in the design of microchips and the devices and components used in the manufacture of microchips. In practice, this means that Chinese companies cannot use American software to design microchips, and they cannot manufacture the chips they design with American equipment.
Microchips are humanity’s most significant technological achievement
The United States alone cannot prevent the export of advanced chip technology to China. The semiconductor market is global and several different countries have their own role in the manufacture of chips. The industry is based more on cross-border cooperation than competition.
After announcing its own export restrictions, the United States has begun to negotiate with its partners on a common front. Negotiations have taken place especially with Japan and the Netherlands. Together with the United States, these countries are responsible for about 90 percent of the development of equipment used to manufacture microchips.
– The restrictions on the manufacturing equipment are key to the fact that the restrictions work at all, says a technology expert at the American think tank CNAS Alexandra Seymour In an interview with .
The Japanese Prime Minister who visited the United States last week Fumio Kishida assured in a joint statement (you switch to another service)that countries tighten controls on critical technologies such as semiconductors.
The exits of the Dutch have been more cautious. Dutch politicians have emphasized in their comments that the country does not intend to directly copy the restrictions of the United States, but that it will make its decision from its own economic and security political starting points.
However, the Netherlands has already blocked the export of the most advanced microchip manufacturing machines to China.
If the United States gets its allies to join the export restrictions, China’s chances of developing its own semiconductor technology to the level of Western countries are slim. The production of the most advanced microchips can be considered the greatest technological achievement of mankind. The manufacturing process is described on the pages of the American think tank Brookings as follows (you will switch to another service):
The extreme ultraviolet lithography machine is a technological marvel. The generator sprays 50,000 tiny drops of molten tin per second. Each droplet is shot twice with a powerful laser. The first hit shapes the tiny tin so that the second beam can vaporize it into plasma. The plasma emits extreme ultraviolet radiation (EUV), which is focused into a beam. This beam bounces through a series of mirrors. The mirrors are so smooth that if spread out to the size of Germany, they wouldn’t have a bump higher than a millimeter. Finally, the EUV beam hits the wafer—a marvel of materials science in itself—with a precision comparable to an arrow shot from Earth hitting an apple on the moon. Thanks to this, the EUV machine can draw transistors of only five nanometers on the wafer – the length of a transistor roughly corresponds to the growth of a fingernail in five seconds. This disk containing billions or trillions of transistors is eventually made into computer chips.
Soviet trade councils used to visit the Rolls-Royce factories wearing soft-soled shoes, so that pieces of the materials used in the construction of the engines would stick to the soles and the metal alloys developed by the British could be discovered.
In duplicating the extreme ultraviolet lithography machine, soft-soled shoes are not enough. Building, maintaining and operating such a device requires constant cooperation. Currently, the center of this cooperation is right next to China, in Taiwan.
Taiwan is the world’s most important chip manufacturer
Relations between China and Taiwan have been tense since the nationalists who lost the Chinese Civil War established their own government on the island in 1949. China considers Taiwan a province belonging to it and the Chinese president Xi Jinping has been talking about returning Taiwan for a long time. Taiwanese believe that the island nation has never been part of the current state of China.
CNAS researcher Alexandra Seymour points out that Taiwan’s chip production plays a significant role in terms of the island nation’s security. 92 percent of the world’s most advanced microchips are manufactured in Taiwan. Taiwan’s administration has announced its support for US export restrictions.
Until now, chip production has been seen as protecting Taiwan. Even a small conflict on the island could stop the production that the whole world depends on.
But what now that China no longer has access to high-performance chips made in Taiwan?
– An attack would cause a huge shock to both the economy and production chains. I don’t think this ban will affect China’s plans for Taiwan, says Seymour.
However, relations between China and Taiwan have deteriorated sharply since last summer. In August, China surrounded Taiwan with military exercises.
The United States has stressed that microchip export restrictions do not mean cutting off trade relations. According to the United States, it is a prohibited list of goods suitable for purely military use.
Similar lists have been prepared all over the world page. However, there are periods in history when economic interests have won over security concerns.
When Great Britain sold Rolls-Royce jet engines to the Soviet Union, international politics lived in a vague in-between state. Between the World Wars and the Cold War, there was a moment when a new balance was just taking shape. After the Korean War, similar shops would hardly have been created.
In the same way, we are now living in a change in international politics. The post-Cold War era seems to be coming to an end. The attitude of the great powers towards each other has changed. The window for a market-driven microchip policy has closed.
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