A crucial cluster in modern technologies is the production of semiconductors. Decades of progress in the mass production of chips containing ever-higher numbers of circuits has radically altered the economics of computing and fundamentally reshaped the global economy. The personal computer revolution of the 1980s, the internet revolution of the 1990s, and the smartphone and social media revolutions of the early 2000s were all built on silicon.
The next generation of potentially game-changing consumer and industrial applications built on top of 5G networks will also depend on improvements in the performance and computing power supplied by cutting-edge chips. Access to cutting-edge semiconductors is also critical to the balance of global military power due to their use in high-performance computing and AI and internet of things (IoT) applications, and also the crucial role they play in modern and next-generation weapons platforms.
At present, only two companies – South Korea’s Samsung and Taiwan’s TSMC – manufacture semiconductors on an industrial scale at the most advanced process nodes. These industry leaders are currently producing in commercial quantities at the 7-nanometre (nm) node, while striving to move to 5 nm, and then, finally, to 3 nm by the mid-2020s. For comparison, the US integrated chip manufacturer Intel is also eager to produce in volume at 7 nm, but the company ran into difficulties in achieving this goal, announcing in July 2020 that production of its next-generation chips would be delayed until 2022.
At present, 7 nm chips – including Huawei’s Kirin 990 system-on-chip manufactured by TSMC in Taiwan – are the most advanced semiconductors in commercial use. Huawei’s chip design arm HiSilicon had been working with TSMC on the latest in the Kirin series at the 5-nm processing node.
Despite the growing prowess of Chinese technology firms in areas such as 5G, artificial intelligence, mobile applications and quantum computing, Beijing is still lagging far behind the world’s cutting-edge semiconductor manufacturing technologies. Consequently, in order to meet its ambitious targets and remain competitive on the global market, Chinese technology companies are relying on overseas fabs to create their most advanced chips.
China is stepping up its efforts to master advanced semiconductor manufacturing technologies. Through its huge National Integrated Circuit Investment Fund, created in 2014 and recapitalised in 2019, and also other regional and local funds, it has allocated funding in excess of $200 billion – more than the inflation-adjusted cost of America’s Cold War-era Apollo moon flight. However, China has so far achieved limited results. China’s leading manufacturer of semiconductors, Semiconductor Manufacturing International Corporation (SMIC), is still 3–5 years behind industry leaders Intel, Samsung and TSMC. In August, SMIC announced that it would be able to push its existing lithographic equipment to 7 nm. While this would be a major breakthrough for the company, it would still leave it behind industry leaders.
As for Intel, Samsung and TSMC, they have already been forced to look for new ways of working together and sharing costs to keep up with the current pace of cutting-edge innovation. The combined R&D costs and capital expenditures of US semiconductor companies rose from $40 billion in 2007 to $72 billion in 2019, which reflects the rising cost of complying with Moore’s Law. In 2018, another major player, GlobalFoundries – owned by UAE sovereign wealth fund Mubadala – effectively dropped out of the race for global leadership after announcing that it was going to abandon development efforts at the 7-nm node, primarily due to prohibitive tooling costs.
A specific bottleneck for SMIC and other Chinese manufacturers is extreme ultraviolet (EUV) lithography technology, a next-generation manufacturing technology that is required to move to nodes below 7 nm. EUV, which uses shorter wavelengths of ultraviolet light to produce finer and denser circuits than is possible with earlier manufacturing techniques, is being used by TSMC and Samsung at the 7-nm process node. Intel is working on integrating EUV into its commercial production lines but has run into problems. TSMC, Samsung and Intel will rely on EUV for their 5-nm fabrication.
The development of computer technology is a key element in this race. In 2019, Google developed a 53-qubit quantum computer, a device capable of solving complex problems in approximately three minutes. It may not sound that impressive, but once you consider that it would take a non-quantum computer around 1000 years to perform the same calculations, you start to understand the power of quantum computing.
Whether large or small, companies are investing vast amounts of resources in the development of quantum computers, and many claim that it could be the next big thing in the tech world. According to some estimates, the quantum computing market will reach $770 million by 2025. Between 2017 and 2018, quantum computing experienced a “quantum gold rush”, with investors pouring $450 million into quantum computing.
IBM recently announced plans to build a 1000-qubit quantum computer by 2023.
Transportation also occupies a certain cluster in cutting-edge technologies.
Companies like Tesla, Uber, Cruise and Waymo are promising a future in which cars are essentially mobile robots that can take us wherever we like with just a few taps on a smartphone. TuSimple is trying to push ahead by creating unique technologies with a number of strategic partners. Working with the truck manufacturer Navistar and the shipping giant UPS, TuSimple is already conducting test operations in Arizona and Texas, including autonomous runs from depot to depot. TuSimple is planning on achieving Level 4 autonomy by 2024, which means that its trucks will be able to operate without a human driver under limited conditions that may include time of day, weather, or pre-mapped routes.
It has been noted that the Chinese automotive industry is also actively developing autonomous vehicles. At the same time, China is using an integrated approach where 5G technology and artificial intelligence, which are needed to ensure synergy, are being introduced in parallel.
The country’s autonomous vehicle ecosystem is a part of the New Infrastructure Initiative launched in May 2020. It is included in the five-year plan and has been allocated around $1.4 trillion in funding.
Of course, the most important technology-related sector in geopolitics is defence and security. In the US, this has been linked to three offset strategies launched by the Pentagon.
Scott Savitz from the RAND Corporation has written about two of the great technological trends of this generation and their impact on warfare: “The first is the relentless and rapid improvement in information technology (IT), across fields as diverse as big data analytics, artificial intelligence, and augmented reality. One of its key applications in warfare is to enable inputs from distributed, networked sensors to be integrated and analyzed rapidly, generating timely, actionable information in forms that humans and machines can readily interpret.
“The second trend is related but distinct: the increasing capabilities of unmanned systems to perform valuable missions. These capabilities are growing not only because of advanced IT enabling more autonomous operations, but also because of improvements in materials science, energy storage, design, and other areas.
“A third trend, much less remarked on, is the improvement in sensors, which are becoming smaller, cheaper, and more perceptive, with lower power demands and greater durability in various environments.”
Leading-edge technologies are also providing a number of solutions in the armaments sector that the military is very excited about. One of the most recent is an electromagnetic bomb – a device that generates a high-power electromagnetic pulse or a high-power microwave pulse. Unlike conventional kinetic energy ammunition, electromagnetic bombs have a devastating effect on electronic devices and computer networks.
Although such weapons already exist, new technologies are making it possible to create more powerful devices.
Natural determinism and differing perceptions of the outside world (including threats), which are at the core of geopolitical thinking and strategic culture, are going nowhere in the decades to come. However, technology will have a significant impact on them, and this factor must be taken into account in risk assessments and projections for the future.