Flanked by Dave Anderson, President of NY CREATES, and Tom Caulfield, CEO of GlobalFoundries, at Albany Nanotech, U.S. Senate Majority Leader Chuck Schumer (D — NY) announced a new prerogative to stop the use of semiconductor chips made in China. Schumer noted that this includes supply chains for the Department of Defense, in an effort to bolster national security, along with bringing vital semiconductor manufacturing back from overseas.
According to Schumer, Chinese companies with ties to the Chinese Communist Party (CCP), are selling microchips to companies that do business with the federal government, and suppliers to those businesses, which makes the U.S. government more vulnerable to cyberattacks and the exfiltration of information by foreign competitors, and hence puts New Yorkers’ data at risk.
To thwart this, Schumer noted he is working to add a bipartisan provision to this year’s National Defense Authorization Act (NDAA) to limit the use of products or services procured by the federal government if those products or services use chips from known companies that pose a national security risk. Specifically, Schumer’s NDAA provision adds three Chinese companies, including SMIC, as well as ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC), all with known links to Chinese state security and intelligence apparatuses, as newly covered entities to limit federal procurement of products or services that uses microchips produced by these Chinese companies.
Schumer explained that this isn’t the first instance of China undercutting or manipulating a global economic sector. He noted that in the past, for instance, Crucible steel in Syracuse had been hurt by Chinese currency manipulation, making it harder for them to sell exports and compete globally. Additionally, he cited China’s stealing of U.S. intellectual property.
“I think we have to be much tougher on China,” Schumer said. “We need them as a trading partner. There’s no question about it but they’ve gotta play fair.”
Schumer additionally emphasized the need for more prioritization of ramped-up cyber security investments by the public and private sectors to thwart governments and actors like China.
“We need more cooperation,” Schumer said. “We now have legislation that requires when companies get attacked, they also wanted to keep it secret and not make it public, they now have to let the proper authorities know.
“We’re putting a lot of dollars in our defense budget and our homeland security budget to protect us from cyber-attacks. More needs to be done in that regard for sure,” Schumer opined.
Schumer added that the NDAA provision will help protect safe and trusted suppliers of semiconductor technology by limiting the proliferation of nefarious semiconductor products, helping build more secure and resilient domestic supply chains of chips made in places like Upstate New York. GlobalFoundries’ planned expansion in Malta, along with the leadership Albany Nanotech and its partners are providing in some of the most cutting-edge microchip research and development, position the Capital Region and Upstate New York to supply chips needed by our military and other critical infrastructure and replacing Chinese-made chips that threaten our national security.
Schumer also noted that the Biden administration is looking to get the chip fab dollars and investment tax credits out quickly, within the next few months.
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