America's coercive chip ban shows the true face of its foreign policy

Last week the US presidential administration unleashed sweeping new export controls on the sale of advanced semiconductor equipment to China, not just targeting one specific entity, but the country as a whole.

Worse still, the new restrictions made use of the Foreign Direct Product Rule, an act of extraterritorial unilateralism that not only prohibits American firms from dealing with the target, but also extends to any third-party company or entity who utilizes any US intellectual property in its business dealings.

Previously, this move had only been used in reference to Huawei. As a result, it is posed to inflict colossal damage upon the global semiconductor industry supply chain, and is a sign that hardliners continue to gain influence in the White House.

American foreign policy in the post-Trump era is dedicated to destroying globalization when it does not suit US preferences. While for decades the United States was a champion of free markets, free trade and unfettered capitalism, believing that such notions maximized its own ideology and influence, Washington now perceives that this globalized economic system has empowered rival states who have grown in stature, but not succumbed to US unilateral hegemony as once hoped after the Cold War, namely Russia and China. The famous "end of history" thesis did not materialize, and as such Washington no longer sees globalization as advantageous to itself.

As a consequence of this, US foreign policy has now taken an inward turn. Its fundamental goal is to reassert its "lost" influence by exacerbating geopolitical conflict and undermining economic integration between rival states and allies it sees as its own rightful dominion.

If there is peace and stability, the US will actively create a crisis. In other words, America perceives it cannot truly compete, therefore it must "hobble" others. In line with the Trumpian "America first" ethos, this process involves tearing up supply chains and economic links it deems "strategic," promoting a process known as "decoupling" and attempting to build new US-centric alternatives in their place.

In respect to both Moscow and Beijing, this process is being pushed not only in the fields of energy (such as oil and gas), renewable energy (such as solar panels), but also more specifically high-end technologies, electronics, artificial intelligence and semiconductors.

Since the Trump era, the US has made it its mission to try and hobble China's development and technological advancement by progressively isolating it from the global semiconductor supply chain. The moves have grown more and more aggressive, with the latest act being an unprecedented escalation. Whilst it attempts to tear down China's chip industry and cut it off from advanced equipment, it is also strongarming key semiconductor firms to build capacity in the US.

The manner in which this is being conducted also reveals the coercive nature of US foreign policy, that is, if it cannot "persuade" allies to join in, then it will impose unilateral force upon them whether they like it or not.

The latest "foreign direct product rule" restrictions come amidst a failure of the United States to persuade other chipmaking states to join a comprehensive alliance against China. This includes South Korea and Japan. US led-semiconductor restrictions pose a serious risk to the exports and market access of these respective countries in China. But the US does not care about their national interests. The imposition of the rule by the US in response to allies' willingness to cooperate reflects the experience of Huawei, whereby when the United Kingdom initially rebuffed Washington's demand to exclude the firm from their 5G networks, they responded with tougher restrictions to force their will on the target.

In pursuing this path, the United States is carving up a global economic system in the name of its own, strictly unilateral, national interests and is forcibly creating ideological blocs wherein it can wield exclusive political and economic dominance.

For the global semiconductor supply chain, and for the prosperity of the world as a whole, this decision is disastrous. The United States is an instigator, who will defend its own hegemonic position at all costs, and for that matter, irrespective of the costs of others. Countries must be prepared to come together to defend the international economic order, which ironically created by the United States is now being purposefully destroyed by it.

(The author, a postgraduate student of Chinese studies at Oxford University, is a South Korea-based English analyst on international relations. The views are his own.)