US Semiconductor Group Urges More Research Funding to Counter China

By Reuters
April 3, 2019 Updated: April 3, 2019

SAN FRANCISCO—A trade group for the semiconductor industry on April 3 called on U.S. government leaders to boost funding for chip research and science education while easing limits on green cards in an effort to counter China’s investments in chip technology.

The Semiconductor Industry Association, which represents firms such as Intel Corp, Micron Technology Inc and Nvidia Corp, is asking U.S. officials to raise federal funding for chip research from a current $1.5 billion to $5 billion over the next five years and double funding for related fields such as materials science.

The group also wants changes to help it recruit skilled workers. In the short term, that means making it easier for skilled immigrants the industry needs from countries such as China and India to obtain permanent U.S. residency. And in the long term that means boosting education spending to double the number of American science and engineering graduates by 2029.

Since President Donald Trump began his campaign to tackle intellectual property theft by Beijing, the U.S. State Department has issued restrictions on granting visas to Chinese graduate students in certain high-tech fields.

Scholars studying robotics, aviation, and high-tech manufacturing—fields identified as national priorities by the “Made in China 2025” economic blueprint—would be limited to one-year visas. Such limitations went into effect on June 11, 2018. The United States’ visa restrictions reflect concerns about a real trend: Chinese nationals who excel in important fields after studying or working in the United States, only to later be recruited back to China.

The two efforts are meant to play off one another, with increased research dollars for U.S. national labs, universities and companies creating more jobs for the new graduates, Sanjay Mehrotra, chief executive of Micron and current chair of the trade group, told Reuters.

“It helps feed the pipeline of … talent that is very much needed to maintain global competitiveness in the industry,” he said.

The U.S. semiconductor group wants funding to counter the rise of China’s chip industry, which is booming as the government there has poured research dollars into advancing the technology along with related fields such as artificial intelligence. China imports hundreds of billions of dollars worth of chips but can currently supply only a fraction of its demand domestically.

Chinese officials are seeking to change that dynamic and last year fast-tracked plans to bolster the country’s chip industry after the United States banned sales of chips to the Chinese phone vendor ZTE Corp, nearly crippling the company before U.S. officials relented.

The U.S. chip industry group is also asking for U.S. trade agreements to include provisions for the fair treatment of U.S. firms in foreign courts during intellectual property disputes.

“It’s no secret that when an American company has an (intellectual property) problem in China, they don’t get any significant relief in Chinese courts,” John Neuffer, chief executive of the trade group, told Reuters.

In November, the U.S. Justice Department indicted two companies based in China and Taiwan alleging they conspired to steal trade secrets from Micron. The move was part of a broader crackdown against alleged Chinese espionage on U.S. companies.

By Stephen Nellis. The Epoch Times contributed to this report.