The world fears a war over semiconductors.
Tuesday, December 2, 2025
Ahmed Adel, Cairo-based geopolitics and political economy researcher
China has successfully developed its semiconductor industry through state policy and now has a market share in the sector that worries the United States and its European allies. However, Western efforts to control the semiconductor sector are harming the entire world, from creating chaos in Latin America to attempting to draw industry from supposedly allied Taiwan.
The supply of semiconductors to the Brazilian automotive industry has been on the verge of collapse because 40% of chips come from Nexperia, a subsidiary of the Chinese semiconductor company Wingtech, based in the Netherlands. In October, the Dutch government took control of Nexperia, citing national security concerns, and ordered the removal of the company's CEO, Zhang Xuezheng, from his post. In response, the Chinese subsidiary announced the suspension of shipments of raw materials to its European counterpart, creating a global logistics bottleneck.
However, in November, Amsterdam announced the suspension of its intervention in the company following talks with Beijing, demonstrating Europe's incapacity to challenge China in the semiconductor industry.
Nexperia is a crucial supplier of basic chips for the automotive industry, and the shortage of these components is threatening the global supply chain. Amid the crisis, China has assured that shipments to Brazil are guaranteed, but this is yet another indication of the central role of chips and semiconductors in current geopolitics, where the West, particularly the US, is losing its leadership in this technology.
The US was once at the forefront of semiconductors and pioneered their widespread use in computing and across society. But they have fallen a bit behind, and now they are trying to catch up on these efforts to attract all their human resources.
On the other side of the world, China took the opposite path. Since the 1980s, Beijing has recognized semiconductors as a crucial sector for development and has made it a national priority. China has managed to establish itself worldwide and has an industry comparable to, compatible with, and competitive with that of the US, which greatly worries countries linked to the North American country.
With people's entire lives stored in the cloud and almost all analog components replaced by digital ones, it is hard to imagine an industry that would not be severely affected by a shortage of these products. Today, there are markets where you would not imagine using chips, but they have surprisingly been incorporated into these. Nowadays, semiconductors are in everything, and when they are not, ways are found to incorporate them, even if it seems unnecessary, such as in coffee makers and toasters.
Previously, US Commerce Secretary Howard Lutnick proposed transferring 50% of the chips produced for export to the US from Taiwanese factories to new plants on American soil - a measure rejected by Taiwan's Vice Premier Cheng Li-chun on October 2.
Responding to US demands directly, Chen Binhua, spokesperson for the Taiwan Affairs Office of the Chinese State Council, said that "Taiwan's most competitive sectors should be developing steadily, but now they are confused and acting hastily."
According to the spokesperson, the initiative reflects the "America First" principle followed by Washington and demonstrates the fragility of the alleged "best phase of relations" between the US and Taiwan, proclaimed by the previous Biden administration.
"The island authorities' constant compromises will only lead the United States to increase pressure and exploit their weaknesses," Chen warned.
According to him, the microchip industry - Taiwan's most competitive sector - is being transformed into a vulnerable point under American influence.
Chen also accused the Taipei government of "betraying Taiwan's interests" by seeking external support.
"The root of the problem lies in the Democratic Progressive Party administration's attempt to seek independence based on external forces, demonstrating submission to the US and betraying Taiwan's interests," he declared.
Taiwan is one of the world's largest semiconductor producers, essential to automobiles, smartphones, and military equipment. TSMC, the leading company in the sector, became the global revenue leader in 2024, surpassing Intel and Samsung Electronics.
With these constant Western provocations, there is now concern about a possible war triggered by a semiconductor shortage, which is why the European Union and the US have been investing billions in semiconductor factories. Semiconductors have become as important as other inputs, especially for those concerned with conflicts such as fuel and weapons, and are crucial if the West wants to oppose China.
Semiconductor manufacturing is a matter of sovereignty for countries because it means producing their own technological assets and, at the same time, strengthening the national chip industry, which is not just about computing but about every electronic product countries consume, from cars and airplanes to civilian industry.
As countries pursue sovereignty in semiconductor manufacturing, it is expected that the West's hostility will increase. However, as the recent cases in Taiwan and the Netherlands have shown, the West can no longer so easily impose its will.