From Playstation gaming consoles and iPhones to Dell laptops and Tesla electric cars – modern electronics depend on semiconductors (chips) to manage their complex functions.

US President Joe Biden recently signed the Chips and Science Act(A shortage of chips during the Covid-19 pandemic disrupted the production of multiple products and initiated a debate in the US on its dependence on chip imports. ), which sets aside tens of billions of dollars to encourage companies to set up manufacturing and design facilities in the US.

The US, South Korea , Taiwan and Japan meet most of the world’s semiconductor demand. They sit on most of the capacity to design, produce and test tiny chip components. China sees Taiwan as essential part of its territory, a claim much of the world accepts. Only a handful of small nations see Taiwan as a sovereign state. Even the US adheres to the One China policy and hasn’t recognised Taiwan as an independent country. Starting in early August, China’s military carried out live-fire drills around Taiwan that included the use of its sophisticated jets and naval ships. Taiwan’s TSMC is the largest contract chip maker, counting Apple and Nvidia as its customers. Taiwan, a tiny island, relies on US diplomatic and economic support to push back against China.

The so-called ‘Chip 4‘ alliance aims to enhance cooperation between the members on design and production of sophisticated semiconductors.

It’s likely the US, which is home to global tech leaders such as Intel and Google, will convince Taiwan and Japan to join its semiconductor supply chain as leaders meet to kickstart the initiative later this month. But courting South Korea is another story.