China’s Panda Diplomacy, Taiwan’s Microchips, and the Race for AI Supremacy

What do cute panda bears, US - China relations and Taiwan’s microchip fabs have in common? The race for Artificial Intelligence supremacy. China recalled its furry diplomats a week before the Joe Biden - Xi Jinping APEC summit meeting in San Francisco.

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In this episode we discuss China’s panda diplomacy, and how recalling the pandas is connected to US foreign policy, Taiwan’s microchip fabs and AI supremacy. On Wednesday Nov 8, 2023, the two adult pandas, Mei Xiang and Tian Tian, and their 3-year-old cub, Xiao Qi Ji, were guided into metal crates and transported by truck to the airport. They took off in a FedEx Boeing 777 called the Panda Express. Mei Xiang and Tian Tian arrived at the Smithsonian National Zoo in 2000 under a 10-year agreement that has been renewed three times since 2010. Xiao Qi Ji, whose name means “little miracle,” was born in 2020 as a result of artificial insemination – and the little male cub is indeed a miracle, as his mom was considered too old to be able to get the pregnancy to term. Efforts to renew the zoo’s current panda agreement, which ends on Dec. 7, have been unsuccessful. Not only did China refuse to renew the contract, but they’re also taking the pandas back even earlier than previously agreed. 1

The timing of the panda recall is dubious, given that the Biden-Xi bilateral takes place a week later during the Asia-Pacific Economic Cooperation (APEC) summit, which the US is hosting in San Francisco from 11 to 17 November. The encounter on 15 November is their second face-to-face meeting during the Biden presidency. It will be wide-ranging, US officials said, with the Israel-Hamas war, Taiwan, war in Ukraine and election interference to be discussed. 2

China’s posturing in the South China Sea and the Taiwan Strait, the brushes with Philippine ships, and flying its planes dangerously close to American ones - all of this, is pretty much about Taiwan and who will control Taiwan, the world’s largest producer of semiconductors. Chips are what powers AI: 60% of all microchips are produced on the island; 92% of logic semiconductors with components smaller than 10 nanometers, capable of fitting more processing capacity onto a minuscule area while also being faster and more energy-efficient, are made in Taiwan. A single strand of human hair is 90,000 nanometers thick. In 1971, an average transistor was already just 10,000 nanometers thick. Today, the most advanced chips are manufactured at 2 nanometers, with Taiwan Semiconductor Manufacturing Company (TSMC) already working on creating a 1 nanometer chip.

Microchips mean economic power, and more importantly, military power: and military power means geopolitical power. Microchips also mean control of emerging and disruptive technologies, like Artificial Intelligence and synthetic biology. Countries that have the capability to successfully harness AI innovation will be strategically positioned for both improved national security and economic growth.

1. Larissa Gao and Megan Lebowitz With return of three pandas to China, U.S. could soon have none NBC News, November 2023 

2. PHELIM KINE Biden to press Xi on Iran in APEC meeting next week Politico, November 2023