Hey there, family members if LeoFinance, how fared the day? Well, I would like to share a very important piece of information with you today. Yesterday I learnt about one news that, even though it seems remote, has the ability to influence us all. This is an announcement made by China this Tuesday: they shall restrict the export of critical components which are used in the manufacture of semiconductors to the US. And you shall say, what’s the big deal about that? Well, I would suggest you be patient because I am coming in for the kill.
First, for those who are not very conscious, semiconductors are the basic and critical components of almost all the technological gadgets we use these days, starting from mobile phones to the vehicles. One could say that without semiconductors, civilized society as we know it won’t exist. The issue is that China did not take this step for economical reasons, it is a part of economic strategy concerning a war which is becoming more fierce between the two superpowers.
In a way, America has been making efforts to cut China's access to advanced technologies like AI chips by placing some restrictions of its own. And now, China retaliates (for lack of a better word) in the same way it has always known how to – leveraging its status of a dominant supplier to influence the board. And guess what? It’s quite more than just a 'tug of war' between them; These kinds of tensions impact the entire world economy.
Envision! If there is a disruption to the production of chips for electronic devices ie semiconductors, the cost of electronic devices would increase, the introduction of innovative devices would take a longer period, and nations would be caught in a standoff. Never mind how this alters inter-state trade relations. The future? A more fractured world, one in which the economy will be a tool of politics, more than politics will be a tool of the economy.
At a personal level, I feel that a sea change is underway in the current state of global economic relations. It is clear that we are in an era in which whoever possesses the tools of technology is the one who controls the game. And while this may be seen as being distant, in fact, it will be all of us, one way or another, who bravely bare the consequences.
Then, where are we heading towards? Only the future can answer this question but at least we can be sure of one thing: that the world is going through a process of great change and technology is the main field of such change, do not you agree?