If you think that the conflict between China and Taiwan does not affect you and what you do on a daily basis, Citadel CEO Ken Griffin strongly suggests that you think again.
Here’s why.
According to Griffin, America has an unhealthy dependence on Taiwan for its semiconductor production, which alone could make it enticing for China to invade Taiwan.
Here’s what he said at the Bloomberg New Economy Forum in Singapore.
“America is “utterly and totally dependent on the Taiwanese for modern semiconductors. The United States cannot produce anywhere near the number of semiconductors it needs to run its economy.”
The billionaire is referring to the fact that if China seized the semiconductor industry, our economy would suffer big time. Taiwan operates as an independent democracy, which China has no control over. China would make things very difficult for America if they could. And that’s putting it very, very mildly.
“If we lose access to Taiwanese semiconductors, the hit to U.S. GDP is probably in the order of magnitude of 5% to 10%. it’s an immediate Great Depression.”
In October, Joe Biden’s administration announced sweeping export controls, saying American companies can’t sell China advanced semiconductors.
Later in October, Xi Jinping of China announced that his country needs “self-reliance” in manufacturing its semiconductors. China is aggressively prioritizing AI development for its military. That could shift the military balance currently in favor of the U.S.
Here’s a quote from Indonesia’s Commerce Secretary, Gina Raimondo, regarding China’s priorities.
“China is crystal clear. They will use this technology for surveillance. They will use this technology for cyber attacks. They will use this technology to, in any number of ways, harm us and our allies, or our ability to protect ourselves.”
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