Crude oil, to be precise the location of oil reserves, is often an important factor in geopolitical bargaining positions. But that position will be replaced by a semiconductor chip.
This was stated by Intel CEO Pat Gelsinger in an interview with CNN at the World Economic Forum which was held in Davos, Switzerland. According to him, semiconductors will be more important than the location of petroleum reserves in the next 50 years.
According to him, over the past 50 years, the location of oil reserves, land and religion have become geopolitical determinants. But the location of the petroleum reserves will be replaced by supply chain technology and semiconductor manufacturing sites.
Intel currently has semiconductor factories in Oregon, New Mexico, and Arizona, which continue to add capacity. They are currently building a new factory in Ohio, as well as increasing their international presence in Israel, Ireland, Malaysia, Germany and Italy.
They say they have invested USD 20 billion for two chip factories in the US, and prepared around USD 90 billion for their factories in Europe.
This investment, according to Gelsinger, will not only benefit Intel but will also be important for the globalization of the most important resource for the future of the world.
"We need geographically balanced (chips), and a strong supply chain," said Gelsinger, as quoted by us from Techspot, Thursday (19/1/2023).
Gelsinger's opinion may have some truth, especially when considering the scarcity of semiconductor chips that occurred at the start of the pandemic which then impacted many industries, including the automotive industry.
Even the United States made a new law called the Chips and Science Act (CHIPS Act), in which they allocated USD 52 billion to provide subsidies to chip manufacturing companies.
"If there is one thing we can take away from the Covid crisis and the journey of many years, it is that we need a resilient supply chain," he added.
The Intel boss also admitted that his company and a number of other companies are currently awaiting the disbursement of the CHIPS Act funds, which are expected to be disbursed this year.
"We have invested, please give the money. Because we assume they will help us to make this big investment," he explained.
The importance of diversifying the semiconductor supply chain is also because the chip industry is currently controlled by Taiwan. 50% of the chips on the market come from that country.
Gelsinger once mentioned the danger of depending on the fate of semiconductors to Taiwan, especially with China's aggressive actions in the country some time ago. In 2021 Gelsinger once said that Taiwan is not a stable place.
"Beijing sent 27 fighter planes to Taiwan's air defense identification zone. Does that make you feel safer or vice versa," Gelsinger said at the time.