What US-China relations could look like under Kamala Harris

Senior US officials are set to visit China this week in an effort to bolster relations amid heated trade tensions. This comes as Huawei Technologies is reportedly close to introducing a new AI chip that could rival Nvidia's place in the Chinese market. Author of "Chip War: The Fight for the World's Most Critical Technology" Chris Miller joins Market Domination Overtime to discuss the Huawei news and the future of US-China relations.

"We shouldn't be surprised that Huawei is trying to build newer and better chips, given that the Chinese government has anointed Huawei as the country's chip champion and given all the resources that it needs to try to catch up to Western leaders in chip production like Nvidia," Miller explains.

As the 2024 presidential election nears, all eyes are on Vice President Kamala Harris's position on China. He notes that both President Biden and former President Trump have taken relatively similar stances on China and its chips. He adds, "I don't think it's likely that Harris would meaningfully shift from any of those positions, whether it's about subsidizing domestic manufacturing or trying to limit technology transfer to China. Both of those policies have bipartisan support, and they've persisted across multiple administrations."

For more expert insight and the latest market action, click here to watch this full episode of Market Domination Overtime.

This post was written by Melanie Riehl

Video Transcript

Senior us officials are set to visit China this week in an effort to bolster relations amid simmering trade tensions.

This is as China's Huawei technologies is reportedly readying a new chip that will challenge NVIDIA.

That's according to the Wall Street Journal, a sign that us obstacles have failed to limit Chinese companies abilities to keep pace with us.

Tech joining us now, Chris Miller Tufts, assistant professor of International history and author of Chip war, the fight for the world's most critical technology.

So Chris another update in the chip war as far as us versus China today with the news of Huawei building that chip.

I'd be curious just sort of your takeaway here, what it means for us chip companies in China to have Huawei building this product right now.

Well, I would say first off, we don't know much about the details of this new Huawei ship.

So how good it will actually be, how many will actually be produced?

We're gonna have to wait and see and a lot really does depend on uh those details, but I think we shouldn't be surprised that Huawei is trying to build newer and better chips given that the Chinese government has anointed Huawei as the country's chip champion, given it all the resources that it needs to try to catch up to Western leaders in chip production.

Like in video.

Um Chris, we're sort of awaiting economic policy details from Kamala Harris and that campaign, we have a general idea of what uh we're getting in former President Trump.

What are your key questions for Harris when it comes to us, China trade?

Well, I think the key question is, will she pursue a different policy from the Biden administration or something really quite similar when it comes to chip issues and technology competition with China?

The reality is there's been a lot of similarity between what the Biden administration has done and what the Trump administration did when it was in power.

And I don't think it's likely that Harris would meaningfully shift uh from any of those positions, whether it's about stuff domestic manufacturing or trying to limit technology transfer to China.

Both of those policies have bipartisan support and they've uh persisted across multiple administrations.

And so I think it's fair to assume that a potential future President Harris would do something broadly similar.

And Chris, we've been talking about China here and I'm curious about the Taiwan risk knowing that a lot of the A I accelerators are manufactured over there.

What sort of risk lies there right now for the trip sector?

Well, you're right that the A I industry is hugely dependent on Taiwan.

It's almost the case that all A I processors are manufactured by TS MC in Taiwan.

And this has been one of the reasons why the US, as well as other countries have been trying to diversify the chip supply chain.

But right now, the reality is that the manufacturing capabilities of Taiwan's leading chip maker, TS MC ahead of competitors.

And that's why whether it's Google or whether it's NVIDIA companies are turning to TS MC to manufacture their most important A I chips.

Um And when it comes to the attempts to reso uh some of the chip industry, there was a report in the FT this week that some of the big product projects that had been initially sort of green lit as part of the Chips Act or the IRA that there were some delays or maybe even outright cancellations.

I'm just curious of your assessment of those efforts, obviously, even when they're on time, they're not gonna change the industry for quite a while.

So I I'm curious how you're thinking about that.

Well, I think you're right that these facilities are built over multiple years and the industry has been building plants now for over half a century.

So even if you begin building a series of new plants in the US, it only slowly begins to move the needle when it comes to where the majority of ships are produced.

If you look at the plants that are under construction in the US right now, some of them have been delayed, but most of them are on target.

And I, I think we should expect over the next couple of years as the plants come online and it always does take a long time to build chip plans that you're going to see a major increase in capacity to manufacture chips in the United States.

There's, there's really no doubt that the chip that has catalyzed the surge of investment in new facilities like these and it's around the middle of the decade next year in the 2026 2027.

Uh when most of these plants will come online, Chris, great to catch up with you as always, appreciate it.

Thank you.