The supply chain will focus on semiconductors, electric vehicle batteries, rare earth metals, and medical devices
According to Nikkei, US President Joe Biden will sign an executive order this month, to build the supply chain of important chips and technology products without depending on China, thanks to cooperation with Japan and South Korea.

The supply chain will focus on semiconductors, electric vehicle batteries, rare earth metals, and medical devices. This would be a supply chain less susceptible to disruptions such as natural disasters, or policies from unfriendly countries.

The executive order clearly states that working with America's allies will help build a strong and flexible supply chain. Washington will cooperate with Japan and South Korea in chip manufacturing, and Asia-Pacific economies including Australia to exploit rare earths.

The US will cooperate with allied countries to share the supply of this technology. Consider securing a huge stockpile, and ready to deliver in the most urgent cases. This would threaten China's position as a world producer.

According to Boston Consulting Group, the US has seen its share of semiconductor manufacturing plummet in recent decades. From 37% in 1990, this has dropped to just 12% in 2020.

More importantly, however, the US is importing up to 80% of all rare earth metals from China, and about 90% of medical products. The Biden administration sees this dependence as a national security risk.

Electric vehicle batteries are also an important source. While Korea's Panasonic and LG Chem are slowly losing market share to their Chinese rivals, the US will not let that continue.

However, restructuring the technology supply chain to no longer depend on China will take a lot of time.
Axact

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