China Concerned About Its Future Chip Industry

The recent embargo measures taken by the USA against the Chinese chip industry have evidently provoked hectic reactions in Beijing. The state leadership is apparently desperately looking for options to save semiconductor development.

he Ministry of Industry and Information Technology last week called a series of emergency meetings with the country’s leading chip makers. This is reported by the Bloomberg news agency. Accordingly, behind closed doors, there were consultations with representatives of the chip manufacturer Yangtze Memory Technologies and the supercomputing specialist Dawning Information Industry.

The background to this is the new embargo measures by the US government. This had passed a comprehensive package of export controls aimed at slowing Beijing’s technological and military advances. Among other things, it imposed stricter sales restrictions on certain advanced chips and equipment used in semiconductor production.

Fears Looming

According to the Bloomberg report, attendees at the meetings expressed fears that US restrictions could mean the demise of their industry. Although China has been trying for some time to decouple its economy from Western technologies, it is still far from being able to do so in various areas. This applies not only to high-end designs but above all to the most advanced process technologies.

The most recent sanctions are therefore above all a hard blow to the plans that were only just set at the last party congress. You will hardly be able to win the battle for core technologies if you are cut off from important imports in this critical phase. But the embargo also has a strategic component: China remains dependent on certain semiconductor chips from Taiwan and will probably hesitate to escalate the dispute with the island after recent military threats.