- Growing efforts from the U.S. and Europe to consolidate their semiconductor supply chains to compete with China could backfire due to the political strings attached to the aid, Bloomberg reports.
- The downside includes insufficient and ill-timed government aid and different parts of the world striving to secure supplies while championing domestic plants that fail to fill the gap.
- The current trade wars and supply chain crisis became instrumental in weaponizing semiconductors, and other high tech admitted the head of Germany's federal agency for disruptive innovation, Bloomberg notes.
- China's invasion of Taiwan could leave the most advanced chips in the hands of Beijing thanks to Taiwan Semiconductor Manufacturing Co Ltd (NYSE:TSM), which accounts for more than 50% of the global foundry market, including Apple Inc (NASDAQ:AAPL).
- The Bloomberg report said that Russia, sanctioned by the U.S. and Europe, reflected how semiconductors had become increasingly critical political tools.
- Chipmakers have downplayed the potential impact of the sanctions considering Russia and Ukraine's importance in exporting palladium and neon used to make semiconductors.
- The U.S. threatened to shut down Chinese companies if they defied the Western sanctions on Russia.
- Price Action: TSM shares traded higher by 1.06% at $103.17 in the premarket on the last check Wednesday.
