US faces growing strategic challenge from China's rising control Over Technology and Resources

South China Morning Post describes in its article that the US is increasingly facing challenges posed by China's growing strategic position, particularly in key sectors like technology and raw materials. 

China's control over critical raw materials and its rapidly advancing capabilities in artificial intelligence (AI) are putting pressure on the US-dominated semiconductor and technology sectors. Not only is China finding ways to bypass US attempts to limit its access to cutting-edge technologies, but it is also reshaping the global competitive landscape.

However, the United States has established its own "traffic light" in collaboration with allies to limit China’s technological progress. By maintaining strict controls, the US aims to halt the flow of semiconductors and prevent Chinese products and services from entering various sectors, from information technology to social media platforms.

Since the US began limiting China's technological advancements, smaller Chinese companies have exited the market. I contributed a chapter analyzing the decline of these firms for an upcoming book set to be released later this year.

China’s dominance over raw materials critical to semiconductors, military tech, and pharmaceuticals remains unmatched. It has long controlled over 70% of the global supply of rare earth elements, essential for advanced manufacturing, and strategically invested in the refinement of critical minerals like lithium, cobalt, and graphite.

By restricting exports of these resources, China exerts substantial pressure on industries in the US and other developed economies. These materials are essential for producing everything from smartphones to fighter jets. A disruption in their supply would expose the reliance of US, European, and Asian companies on China for their high-tech manufacturing needs.

Blocking the export of rare earth elements is similar to the US strategy of limiting semiconductor exports to China. The US aims to restrict China's access to advanced chips crucial for AI, military technologies, and supercomputing.

By Naila Huseynova