High Performance Microchip Supply - Under Secretary of Defense ...

INTRODUCTION _______________________________________________________________
millimeter-wave circuits and special sensor requirements, to name
but a few, lie outside widely available commercial industrial
capabilities. 14
FOREIGN DEPENDENCE RISKS
Beyond the threat of IC device compromise described above,
dependence on off-shore or foreign-owned semiconductor
components subjects the United States to the risk that several
circumstances, such as quick response or surge capacity in time of
war, could threaten its access to state-of-the-art microelectronics.
Some of these risks are a result of the concentration of the foundry
industry into a few Far Eastern countries.
Political/Geographic Dislocations
In September 1999, an earthquake measuring 7.6 on the Richter
scale hit Taiwan, shutting down all factories in Hsinchu, the national
wafer fabrication center. Fortunately, these plants were restarted in a
matter of weeks; however, a temblor that seriously damaged
Taiwan’s wafer capacity would have started a worldwide run on
commercial wafer capacity that would have taken years to rectify.
During such a time, DOD and its contractors would have little
leverage to obtain needed fabrication services.
A major armed confrontation between Taiwan and China over the
Straits of Taiwan would have similar consequences.
As additional capacity moves to potential adversary countries, the
United States is vulnerable to a governmental “reverse-ITAR” 15 by
which critical technologies are denied to the United States in
international trade. In the late 1980s, the Japanese denied leadingedge
semiconductor manufacturing tools to U.S. manufacturers,
resulting in the need for SEMATECH, a rush joint effort by DARPA
14. Critical Assessment of Technologies, DOD Advisory Group on Electron Devices, 2002.
15. International Traffic in Arms Regulations (ITAR) is the set of procedures used by the
United States to restrict international shipment of arms and defense-related technology.
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