According to a cybersecurity and technology expert, The United States’ unwillingness to spend money is its biggest disadvantage in a tech race with China.
From imposing restrictions on telecommunications giant Huawei to issuing executive orders banning transactions with ByteDance, and forcing the company to sell the U.S. operations of the popular app TikTok, Washington has stepped up efforts to put pressure on China’s technology firms in recent years.
This month, the U.S. Department of Defense said it is in discussions over whether Semiconductor Manufacturing International Corporation, China’s largest chip manufacturer, should be subjected to export restrictions.
“The U.S.’ biggest disadvantage in this tech race is its unwillingness to spend money,” James Andrew Lewis, senior vice president and director of the Technology Policy Program at CSIS, said on CNBC’s “Squawk Box Asia” on Thursday.
“China might outspend us a 1,000-to-1 when it comes to investing in semiconductors and a 1,000-to-1 is no way to win the race,” said Lewis, who previously worked for the U.S. Departments of State and Commerce. He explained that while there is bipartisan support for a bill to increase federal incentives to boost American leadership in semiconductor manufacturing, so far “it hasn’t translated into money.”
Semiconductors make up an important part of the tech race that also includes the U.S. and China competing for dominance in areas such as artificial intelligence and quantum computing.
“I think they are realizing that if you want to play in this game with China, you are going to have to spend more than a few million bucks,” Lewis added.
“China has advantages – a willingness to spend, a strong investment in technology, a very determined government but it also has disadvantages. I think where this will get played out is they have learned from the U.S. experience that technological leadership gives you power, influence in the world and they will pursue it,” Lewis said.
“So, we are just at the start of a larger conflict where technology, economic forces and probably your kitchen appliances will play a bigger role,” he added.