SEOUL, SOUTH KOREA – OCTOBER 4: South Korean conservative protesters protest the US and South … [+]
The type and scope of recent U.S. tariffs on Chinese semiconductors and electric vehicles are a precursor to a trade war that will intensify as the AI boom moves beyond its inception. The coming decisions for US trade policymakers focused on China should lead to a shift in Biden's foreign policy with Asia.
Trilateral diplomacy is a political science theory that describes coordinated action between two states (sending countries) aimed at limiting the influence of another country (the target country).1 Trilateral diplomacy can be carried out in different ways. This is one of them.
This first appeared during the Cold War when the US normalized relations with China to check the power of the USSR. In today's geopolitical economy focused (in part) on artificial intelligence, the US would be well-advised to revisit this strategy. However, this time China should be the target country and South Korea will be the country with which the US cooperates.
The aforementioned revenues are a direct response to the Chinese government's support of BYD—the Chinese manufacturer that recently overtook Tesla.
Tesla
Despite the conflicting political ideologies and rivalry between the US and China, their economic interdependence has enabled decades of complex cooperation between the two. As we move beyond the early stages of the AI boom and demand for precious minerals and metals increases, uncertain dynamics between nations may arise. China is not only the world's primary source of refined lithium; Its economy produces 83% of the world's tungsten concentrate. Tungsten is a chemical element essential to the production of semiconductors, which will be at the heart of the ongoing AI boom.
“AI is a perfect example of dependency,” said Lewis Black, CEO of Almonte Industries, the largest producer of tungsten ore outside of China. “The best algorithms are being written in America. Those algorithms run on these miraculous semiconductors made in Taiwan and South Korea, which are truly among the greatest technological achievements of mankind. But it all depends on raw materials. , especially tungsten, which is almost exclusively sourced from China. None of this is possible without raw materials that are out of our control. Can AI continue to develop without China's support? Without diversity in supply, the answer is no.
China's control of tungsten, lithium and other elements that are fundamental to AI manufacturing threatens to increase US dependence on it and derail the delicate balance of power between the US and China. For this reason, the US will need to find alternative sources of tungsten.
This is where the third country of the symbolic triangle comes into play. South Korea has the Sungdong mine, which was the world's largest tungsten mine until low tungsten prices forced it to close in the early 1990s. Tungsten out of China. Lewis Blake, CEO of Almonte Industries, understands the strategic importance of tungsten and mining in Korea. “Singdong has a major role in strategic metals diversification,” Black said. “Korea uses more tungsten per capita than any other country in the world and now they will have a tungsten mine. Singdong's mine in the global market.” By increasing the amount of tungsten from allied countries, it would indirectly benefit American industries, which is important because there are no tungsten mines in the United States.
Although South Korea and the United States have been allies for decades, the two countries' political leaders disagree on how to manage their respective relations with China. Many members of the executive branch in the US doubt that Seoul would support direct confrontation with the Chinese. To effectively check China's economic power, both senders need to establish a united front by finding common ground on how to manage relations with the target. Alliances are more sustainable when they are based on the common interests and goals of the participating countries.
The US government should diversify the sources from which it gets its raw materials. With good reason, Black is optimistic about the role Singdong can play in helping the U.S. rely on alternatives to China. “The Singdong mine shows that the free market has solutions for diversifying raw material sources, but it just takes time. The regulatory requirements of doing business in a democracy mean that it takes 8 to 10 years to open a mine. It will take years. But that's okay. Focusing on developing our relationship with South Korea and other countries full of essential elements will help the US maintain the balance of power. has explained its complex cooperation with China.