Tim Cook Was Warned by the CIA That China Could Move to Taiwan in 2027

Apple CEO Tim Cook was among a handful of tech executives who attended a CIA briefing on China’s possible invasion of Taiwan in 2027, according to an investigative report. The New York Times ($).

An earlier, apparently unreported meeting was held in a secure room in Silicon Valley in July 2023. The meeting was said to have been arranged at the request of then-Commerce Secretary Gina Raimondo, who was frustrated by the tech industry’s reluctance to move chip production to Taiwan.

CIA director William Burns and director of national intelligence Avril Haines reportedly presented the latest intelligence on China’s military plans to Cook, Nvidia CEO Jensen Huang, AMD CEO Lisa Su, and Qualcomm CEO Cristiano Amon.

Cook reportedly told officials afterward that he slept with “one eye open.”

A similar classified session was said to be held at the White House in late 2021, but the administration left doubts because much of the intelligence was already publicly reported. Earlier that year, a US military official told Congress that the military believed that Chinese President Xi Jinping wanted his military to be ready to take over Taiwan by 2027. From the report:

Jake Sullivan, national security adviser to Mr. Biden, listed US reliance on Taiwan for semiconductors as one of America’s greatest risks. He wanted the industry to recognize the risks and support US industrialization. Mr. Biden also wanted to provide $50 billion in federal funding to build semiconductor plants at home [resulting in the CHIPS and Science Act of 2022].

“We were saying: ‘This is crazy. We have to do something about it,'” said Mr. Sullivan in an interview.

The investigation reveals that Silicon Valley is stubbornly dependent on Taiwan Semiconductor Manufacturing Company (TSMC), which produces nearly 90 percent of the world’s most advanced chips, including all of Apple’s custom silicon for the iPhone, iPad, and Mac.

2022 confidential report submitted by the Semiconductor Industry Association and reviewed by The NYT he concluded that losing access to Taiwan’s chip supply would cause the worst economic crisis since the Great Depression, with US GDP falling by 11 percent. Another report of Bloomberg as of January 2024 it is estimated that the conflict will cost the world economy more than 10 billion dollars.

Despite the warnings, the The NYT The investigation found that companies including Apple were initially slow to commit to buying more expensive chips from US factories. Home-made chips cost more than 25 percent more than those produced in Taiwan due to higher costs of materials, labor and permits, and TSMC’s Arizona plants currently use technology a generation behind what is available on the island.

Apple has since taken steps, however. Last summer, Cook visited the Oval Office and pledged to invest 100 billion in the United States, with money used to support TSMC and other chip manufacturers. Apple has also reportedly started holding all-day engineering meetings with Intel to test its manufacturing capabilities.

TSMC has now committed to an estimated $165 billion investment in the US, including land for at least five additional plants in Phoenix. The company’s Arizona facility recently produced Nvidia’s first US-made AI chip, although the report notes that even those chips still need to be shipped to Taiwan for advanced processing.

Meanwhile, the Taiwanese government maintains an unofficial policy that requires TSMC to keep its advanced manufacturing technology on the island. This “silicon shield” is designed to make a country too economically valuable to attack – yet Russia’s invasion of Ukraine has shown that economic self-interest does not necessarily prevent military violence. TSMC’s CFO said earlier this year that its most advanced processes will remain in Taiwan for the foreseeable future.

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