TOKYO — As US President Joe Biden visits Japan and South Korea, the three countries look for common ground on the world stage. One place they find it is in semiconductors.
A first stop for Biden on his first swing through Asia as president was a Samsung factory in South Korea.
“These small chips, just a few nanometers thick, hold the key to taking us into the next era of human technological development,” Biden said Friday.
South Korea’s new president, Yoon Suk-yeol, said over the weekend that he and Biden “visited what can be described as the ‘global epicenter’ of the cutting-edge semiconductor industry. There I could feel the strength of our business and technology alliance.”
Chips are an essential part of everything from cars to household appliances, and will play an essential role in the development of artificial intelligence and quantum technologies. The leaders of the three countries have avoided mentioning China when discussing semiconductors, but export controls are also on the agenda.
“The most important thing for investors [from Biden’s trip to Asia] could be what they say about supply chains and semiconductors and how much they align with export controls of sensitive technologies to China and investments in the US,” said Michael J. Green, senior vice president for Asia and Japan at the Center for Strategic and International Studies.
US Secretary of Commerce Gina Raimondo (center) met Japan’s Minister of Commerce Koichi Hagiuda in Tokyo on Monday. The two democracies are working to solidify their alliance amid economic uncertainty around the world. US Ambassador to Japan Rahm Emanuel is at left.
Ted Kemp | CNBC
US Secretary of Commerce Gina Raimondo met with her Japanese counterpart Koichi Hagiuda in Tokyo on Monday. The two discussed “collaborating in areas such as semiconductors and export control,” according to a CNBC translation of a statement from Japan’s Ministry of Economy, Trade and Industry.
Japan and South Korea are longtime American allies, and both are technological powerhouses. But as of 2020, the two countries also have larger export ties with China than with the US
US policy
To play a central role in geopolitics surrounding semiconductors, the Biden administration recognizes that the United States must increase its economic importance in Asia.
While in Tokyo, Biden is expected to outline details of the Indo-Pacific Economic Framework, an agreement that will focus on common standards related to digital technology and supply chains.
However, the IPEF will not be a free trade agreement.
Domestically, Biden must contend with American voters on both the left and right who are suspicious of trade deals.
The United States pioneered what was expected to be a massive free trade agreement, the Trans-Pacific Partnership, or TPP, only to see it crushed by former President Donald Trump as soon as he took office in 2017.
The TPP included twelve nations in Asia Pacific, North America and South America.
Trump’s competitor for the presidency, Hillary Clinton, said during the campaign that she would also withdraw from the TPP, although she was personally working on it as secretary of state under President Barack Obama.
After the United States undercut the TPP by unilaterally withdrawing, the remaining 11 nations moved to form the Comprehensive and Progressive Trans-Pacific Partnership – which China has officially applied to join.