Semiconductor analyst Malcolm Penn has raised concerns about the short-term effects of suggested high tariffs on imported chips by U.S. President-elect Donald Trump, stressing their potential to impact consumer prices and industry profitability.
Trump has criticized the CHIPS and Science Act that the U.S. government signed into law in 2022 in a bid to revive the country's sci-tech and chip sectors by offering incentives to chipmakers and forcing them to take side. He suggested high tariffs on imported chips, instead of relying on federal incentives for domestic production of semiconductors.
In an interview with China Global Television Network (CGTN), Penn highlighted the stark contrast between federal incentives and proposed tariffs on imported chips.
"I think the thing about the CHIPS Act is it was designed to encourage manufacturers to build factories back in the United States, and that takes a long time. So you can understand why Mr. Trump doesn't like that because it will be the next president that gets the benefit of that, rather than him. Whereas tariffs are an instant effect and that will put the price up of everybody's imported components. And that would then have an immediate impact on the cost of everything that we buy and has electronics in it. And those effect take immediate effect because nobody keeps on inventory anymore. So the fact is that you put the tariff, it would be instantly happen and the prices would rise straight away," he said.
Penn highlighted the critical role of semiconductors in the cost structure of various goods, particularly in the automotive sector. He noted that a 200-percent tariff on semiconductor imports, as proposed by Trump, would triple their price, driving up car manufacturing costs by 10 to 20 percent.
"I think that the semiconductor is anything from around 10 percent to 30, 40 percent of the cost of a car, depending on whether it's conventional gasoline driven car or an EV (Electric Vehicle) car. And so it is a big part of the overall cost. Now the actual chip value in that, there is probably half that amount. But anyway, that's still a big amount. So if you suddenly add 200 percent of the cost of the chip and effectively makes the chip three times the price that it currently is, that would affect the cost of manufacture by a minimum of 10 percent, probably could be as high as 20 percent," Penn said.
Trump-proposed tariffs on chip imports to impact industry profitability: analyst
An exchange program between China and France has provided thousands of French students with the opportunity to attend Chinese universities over the past year, giving them a comprehensive and multidimensional view of the country through their studies.
In 2024, China proposed an initiative aimed at bringing the total number of French students in China to more than 10,000 and doubling the number of young Europeans on exchange programs to China within the next three years.
Then, in June of that year, the education ministries of China and France jointly launched the Young Envoys Scholarship (YES) program during the first China-France Education Development Forum held in Paris.
Among the students to take advantage of the program is Mathis Champaigne, a French master's exchange student from the Institute of Higher Electronic Education (ISEP) in Paris. Through YES, he arrived at the School of Artificial Intelligence and Automation, Huazhong University of Science and Technology (HUST) this September for a five-month study program.
According to the student, the program offered a valuable opportunity to learn about artificial intelligence (AI) from renowned scholars.
"In this country, you are very advanced in this AI field and so you have a lot of researchers, a lot of universities, very involved in this AI research. So for me that was an opportunity to learn from a great professor in a great university," Champaigne said.
Currently, 29 French students from seven French universities are studying at HUST across various majors, for periods ranging from two weeks to a full academic year. For some, a short-term exchange can give way to deeper ambitions.
"I want to extend my semester and stay longer because I feel like here the campus is made for students to have good experience while studying," said another YES program participant of HUST, an undergraduate student from the University of Strasbourg.
Since the initiative was proposed over a year ago, more than 8,300 French students have come to China for exchanges and studies, helping to spur a broader trend across Europe, with about 32,000 students from across the continent having chosen to undertake exchange programs in China.
The program also partners with other Chinese institutions, including the East China University of Science and Technology (ECUST), where exchange students have had similarly successful experiences.
"So, the YES program is a really good program to study abroad and you can choose many different topics and minors. I think that's the best way to see China," said Paul Ferrigno, another YES program participant of ECUST, a graduate student from Montpellier Higher College of Chemistry.
"And engineers in the future, they will have to see by themselves how this country is changing very quickly, how this country is very good in innovation, research, technology, and finally how China is addressing global warming and sustainable development," said Jacques Mercadier, French dean of the International Elite Engineering School of ECUST.
Exchange program fosters China-France partnership in talent cultivation
