THAT’S THE WAY IT WOULD WORK.
MARIA: JOINING ME RIGHT NOW A
FOX BUSINESS EXCLUSIVE IS
COMMERCE SECRETARY WILBUR ROSS,
MR. SECRETARY, GOOD TO SEE YOU,
THANK YOU SO MUCH IF BEING HERE.
>> GOOD TO SEE YOU, MARIA.
MARIA: LET’S TALK ABOUT THE
CHANGE IN RELATIONSHIP WITH
CHINA AND THIS MOVE TO GET -- TO
GET SUPPLY CHAINS HERE.
WHAT ARE YOU GOING TO NEED TO DO
TO GET COMPANIES TO MOVE SUPPLY
CHAINS OUT OF CHINA SO THE
COUNTRY IS NOT SO RELIANT ON
FOREIGNERS TO MAKE THE VERY
IMPORTANT THINGS LIKE WE NEED
LIKE PRESCRIPTION DRUGS?
>> WELL, REMEMBER, THE
SEMICONDUCTOR WAS INVENTED IN
THE UNITED STATES, BUT SINCE
1987, TSMC, TAIWAN SEMICONDUCTOR
MANUFACTURING COMPANY, HAS BEEN
THE LEADER IN IT AND RIGHT NOW
THEY ARE AT THE CUTTING EDGE OF
TECHNOLOGY.
THE WAY YOU MEASURE TECHNOLOGY
IN SEMICONDUCTORS IS BY HOW MANY
NANO METERS AND SIZE THE CHIP
IS. COMMODITY SEMICONDUCTORS ARE UP
COMMODITY SEMICONDUCTORS ARE UP
AROUND THE 11 NANO METERS AND IT
HAD BEEN AROUND 7NANO METERS.
IT WOULD BE 5NANO METERS AND IT
WOULD MAKE IT CUTTING EDGE AND
THAT’S WHAT MAKES IT SO
SIGNIFICANT.
THE SMALLER THE NUMBER OF NANO
METERS THE MORE POWERFUL THE
CHIP CAN BE SO THIS WOULD BE A
BLOCKBUSTER OF A CHIP.
MARIA: HOW DID YOU GET THEM TO
DO THIS IN ARIZONA, REALLY WHAT
I’M ASKING, ARE YOU GOING TO
NEED TO COME UP WITH A TAX
INCENTIVE TO GET COMPANIES TO
UNDERSTOOD DO, UNRAVEL WHAT
THEY’VE GOT, THE INFRASTRUCTURE
THEY’VE GOT PERHAPS IN CHINA AND
MOVE IT TO THE UNITED STATES,
WHAT’S THE INCENTIVE TO DO THIS?
I’M WONDERING HOW REALISTIC IT
IS TO MOVE THE SUPPLY CHAINS.
>> WELL, TSMC THINKS IT’S
REALISTIC ENOUGH TO MAKE THE
ANNOUNCEMENT.
MARIA: WAS THERE AN INCENTIVE TO
GET THEM TO DO THAT?
>> SURELY, THE STATE AS NORMALLY
WOULD AS PROVIDING SOME RELIEF,
SOME OF THE IMPEDIMENTS THAT
OTHERWISE MIGHT HAVE PREVENTED
THEM FROM DOING SO, BUT THE MOST
IMPORTANT THING ABOUT THE TMC IS
TWO THINGS, ONE IS THAT THEY
HOPE TO BRING THEIR SUPPLY CHAIN
WITH THEM.
THERE ARE ABOUT 80 KEY SUPPLIERS
TO TSMC AND WE ARE VERY --
MARIA: THAT’S VERY IMPORTANT,
YES.
>> BECAUSE THEN WE WILL HAVE A
VERTICAL INTEGRATION AND ARIZONA
SINCE IT ALREADY HAS INTEL,
ALREADY HAS ON SEMICONDUCTOR
WILL NOW HAVE A VERY POWERFUL
TECHNOLOGY COMPLEX THAT WE HOPE
WILL BE VERY VERTICALLY
INTEGRATED AND THAT SHOULD
FACILITATE EVEN MORE ACTIVITY.
WE ARE BUILDING A REAL
SEMICONDUCTOR ECHO TECH.
MARIA: THAT’S TERRIFIC, AND TO
SEE IT IN ARIZONA IS ALSO REALLY
INTERESTING.
I WANT TO GET TO THE BREAKING
NEWS THIS MORNING.
SECRETARY OF THE COMMERCE
DEPARTMENT IS NOUNSING THAT IT
WILL AMEND ITS FOREIGN DIRECT
PRODUCT RULE AND THE ENTITY LIST
TO TARGET HAUWEI AND HAUWEI’S
ACQUISITION AND EARLIER THIS
MORNING THE DEPARTMENT IS
EXTENDING LICENSE AUTHORIZATION
OF HAUWEI TECHNOLOGY FOR ANOTHER
90 DAYS AND YOU’RE ALSO WARNING
FOR THOSE BENEFITING SHOULD
PREPARE FOR LICENSE TO EXPIRE IN
AUGUST.
WALK US THROUGH THIS AND HOW
WOULD THIS PROTECT AMERICAN
TECHNOLOGY AND JOBS AND GIVE US
THE SENSE OF THE ISSUES AROUND
HAUWEI, SECRETARY?
>> SURE, THAT HAS BEEN A VERY
HIGHLY TECHNICALLY LOOPHOLE
THROUGH WHICH HAUWEI HAS BEEN
ABLE, IN EFFECT, ABLE TO USE
TECHNOLOGY WITH PRODUCERS.
FOREIGN DIRECT PRODUCT IS A
HIGHLY TAILORED THING TO TRY TO
CORRECT THE LOOPHOLE AND MAKE
SURE THAT THE AMERICAN FOUNDRIES
ARE COMPETING ON EQUAL FOOTING
WITH THE FOREIGN ONES.
THAT’S QUITE SEPARATE FROM THE
TSMC DEVELOPMENT WE JUST TALKED
ABOUT.
AND WE BELIEVE THAT WILL HAVE A
--
MARIA: YEAH.
>> THAT WILL HAVE A VERY
POWERFUL IMPACT BECAUSE WE NEVER
INTENDED THAT LOOPHOLE TO BE
THERE.
THE OTHER ONE ABOUT THE
EXTENSION AND THE 90 DAYS, WE
HAVE MADE EXTENSIONS MAINLY TO
MAKE SURE THAT THE RURAL
TELECOMS HAVE PLENTY OF TIME IN
ORDER TO WEAN THEMSELVES FROM
THE HAUWEI EQUIPMENT.
YOU’RE AWARE OF THE FCC HAS COME
OUT AGAINST USE OF HAUWEI AND
SPECIFICALLY BANNING USE OF
FEDERAL FUNDS TO PUT HAUWEI
EQUIPMENT INTO THE RURAL
TELECOM, BUT THEY ALSO NEEDED
FOR MAINTENANCE AND FOR UPGRADE,
SO WE ARE VERY PLEASED THAT
CONGRESS HAS APPROPRIATED
$1 BILLION TO HELP THE RURAL
TELECOMS TO WEAN THEMSELVES AND
YET WE ARE GIVING THEM ANOTHER
EXTENSION, WE WANT THEM TO MAKE
CLEAR TO US DURING EXTENSION IN
MID-AUGUST WHAT THEY ARE DOING
TO WEAN THEMSELVES FROM HAUWEI,
SO 3 UNRELATED DEVELOPMENTS THAT
JUST HAPPENED TO COME OUT IN THE
SAME DAY.
MARIA: WELL, THIS IS A REALLY
IMPORTANT DEVELOPMENT AND
SECRETARY POMPEO HAS TOLD ME
THAT HAUWEI ACCESS AN ARM OF THE
CHINESE COMMUNIST GOVERNMENT IN
TERMS OF SURVEILLANCE BECAUSE
THERE ARE BACK DOORS IN HAUWEI
EQUIPMENT YOU DATA GOES RIGHT
BACK TO THE COMMUNIST
GOVERNMENT, SO PEOPLE ARE
WONDERING IF COMPANIES
UNDERSTAND THE THREAT.
SOUNDS LIKE YOU ARE