Deutsche Welle (English edition)
US: President Biden urges CEOs to help end chip shortage
US domestic industries are struggling to keep up with demand for computer chips and semiconductors. The White House is offering billions in domestic aid to help boost production.
US President Joe Biden told senior executives on Monday that America was suffering from the global computer chip shortage, urging them to invest in domestic production as part of his infrastructure plan.
"We need to build the infrastructure of today, not repair the one of yesterday," Biden told the group of 19 corporate leaders from the technology, chip and automotive industries.
"China and the rest of the world is not waiting and there's no reason why Americans should wait."
Lockdowns produce surge in demand
Carmakers are competing with the consumer electronics industry for chip supplies as people spend more time at home during global coronavirus lockdowns.
The release of a new iPhone has already been delayed,
demand for personal computers has surged, and automakers are cutting production owing to a lack of key parts, most notably the semiconductor wafers needed to make computer chips.
The supply crunch could lead to a potential 1.3 million-unit shortfall in U.S. car and lightduty truck production this year.
Broadband internet and cable TV companies also face delays in
receiving network switches, routers, and servers.
How much does Biden want to spend on infrastructure?
President Biden said he had bipartisan support for fresh legislation to fund the chip industry — to the tune of $50 billion — as part of his drive to rebuild U.S. manufacturing as part of his $2 trillion infrastructure plan.
Biden and his top advisers view the semiconductor shortage as a "top and immediate priority," the White House said after the meeting.
CEOs of AT&T, Dell, Ford, General Motors, Stellantis (formerly Fiat Chrysler), Intel, Northrop Grumman, and others were all scheduled to attend.
But can the US really shake up supply chains at short notice?
But questions remain over what the Biden administration can really do to shake up US supply chains at such short notice. The industry typically has a production cycle of three to five years.
"Right now, there’s no structural changes that could alleviate the shortage," Wedbush analyst Daniel Ives told the Associated Press.
Intel Corp has said, however, that it will aim to make chips for car plants at its factories in the next six to nine months.
The U.S. has only 12% of the world's semiconductor wafer factory capacity, down from 37% in 1990, according to the Semiconductor Industry Association. China, Taiwan, South Korea and Japan combine to account for more than 70%.
“I think now it's just exposing the structural issues as well as some of the potential national security issues the US faces, given our reliance on Asia," Ives said.
jf/msh (AP, Reuters)
monopolized vaccines, leaving lower income nations scrambling. There is collective fear that without adequate vaccine distribution, the variants will grow and mutate, curbing the progress that has been made since the vaccine has been made available.
"The virus will get a space to continue to spread and mutate, then you'll have more variants," said Tedros. "Even those countries which have high average of vaccines will not be secure."
The worry is that the vaccines will be rendered useless against the new variants and stall global efforts.
Good deal of criticism
There has been criticism that countries have actively engaged in so-called vaccine nationalism. In the United States, President Joe Biden has reversed some of the Trump administration's decisions regarding global health, like rejoining the World Health Organization and supporting COVAX. Still, much of the procurement for the vaccine has been for national use only, making the gap between the have and have-nots even greater.
"We need international solidarity, Axel van Trostsenburg, managing director of operations at the World Bank, said. "We need to reserve a certain amount of installed capacity for lowincome countries. There is a huge risk they will be left out and only get the bulk of the vaccines next year."
The worry is that wealthy nations are not making a serious effort to combat the issue of vaccine inequity. Much of the developed world has publicly agreed that it is necessary to support the global effort, but critics are concerned that their words are not matching their efforts.
"If the major countries agreed to solve this problem, to address vaccine equity, they can do it," said Tedros. "They have everything, they have everything to do it, so political will is missing.”
Lack of preparedness
One of the hurdles that has been apparent is that there has been a lack of preparedness to address the issue of vaccine distribution in an equitable fashion.
"We are stuck where we have been for 30 years, reliving the equitable response to previous emergencies," Gro Brudtland, former prime minister of Norway said. "Lower income countries have vaccinated less than 1% of their population, and many of the poorest countries have yet to receive a single dose."
Brudtland warned that the international systems in place are not adequately put together in addressing a global issue of this scale. The international community's fiscal response has continued to be at the heart of the problem.
"Investments have represented a fraction of what is required, funding in millions, what should have been billions." Brudtland said.
The warning is that the global community is paying the price for its lack of investment and the world is attempting to urgently respond to challenges that needed to be addressed generations ago.
"We need systematic health system strengthening. This is hard work, the cameras won't be there, but I think it is an absolute necessary part we have to do,” van Trostsenburg said.