23rd Parliamentary Intelligence-Security Forum – Global Supply Chain

Mr. Carl Delfeld contended that supply chain security has been neglected for decades but has emerged as a pivotal factor in U.S. national and economic security, particularly in the context of the U.S.-China rivalry. He underscored Apple’s production challenges in China and the symbolic inauguration of a $12 billion semiconductor facility in Arizona, which involved leaders from Apple, Nvidia, and Taiwan Semiconductor Manufacturing Company. Notably, the irony lies in the fact that U.S. chip production remains costly and technologically inferior to that of Asia. Delfeld emphasized the hollowing out of the U.S. industrial base over the past several decades due to offshoring, free-market complacency, and underinvestment in strategic metals. This has enabled China to dominate critical minerals, rare earth processing, and global manufacturing. He stressed that rebuilding supply chain resilience necessitates an upstream approach, encompassing domestic development, stockpiling, and partnerships among trusted nations, rather than solely focusing on downstream semiconductor subsidies such as the CHIPS Act. He cautioned that China supplies approximately 80% of rare earth oxides and is tightening control over key materials like gallium and germanium. Consequently, he concluded that America must integrate technology, resources, aerospace, and defense strategy to restore industrial strength and avert future geopolitical conflicts over critical materials, akin to past oil wars.