U.S. Commerce Secretary Gina Raimondo has stated that the U.S. should prioritize investments in domestic semiconductor manufacturing and innovation, rather than focusing solely on bans and sanctions against China. "Trying to hold China back is a fool's errand," she said in a recent interview.
Focus on Innovation, Not Restrictions
Raimondo emphasized that the Biden administration's CHIPS and Science Act, which has seen unprecedented spending on U.S. chip infrastructure, "matters more than export controls." She believes that the key to competing with China is to out-innovate them, stating, "The only way to beat China is to stay ahead of them. We have to run faster, out innovate them. That’s the way to win."
Despite U.S. export controls, Chinese companies have reportedly found ways to procure banned chips through unofficial channels. Furthermore, Chinese innovation continues, with businesses adapting and pursuing their goals despite the restrictions.
Uncertainty Under a Potential Trump Administration
Raimondo's comments come as former President Trump is poised to return to the White House in 2025. While the CHIPS Act has enjoyed bipartisan support, Trump has criticized the deal, favoring "enacting tariffs, cutting taxes, slashing regulations, and unleashing American energy" instead of direct government funding.
This uncertainty has led to many subsidy applicants rushing to secure funding before January 20. However, Trump also plans to expedite permits for companies investing over $1 billion in the U.S., potentially waiving some regulations. SoftBank's planned $100 billion investment in AI and other technologies is likely driven by this potential policy shift.
"Trying to hold China back is a fool's errand." - Gina Raimondo, U.S. Commerce Secretary
"The only way to beat China is to stay ahead of them. We have to run faster, out innovate them. That’s the way to win." - Gina Raimondo, U.S. Commerce Secretary
"That chip deal is so bad." - Donald Trump
