Chinese semiconductor industry surprises: optimism grows despite US sanctions and bets on technological self-sufficiency!
Despite the challenges posed by the US-led technology blockade and various forms of international pressure, confidence in China’s semiconductor industry has strengthened significantly, driven by encouraging advances and strong political support.
The CSI Semiconductor Index recorded a 6.84% increase on Monday, reaching its highest level since December 2021, while the CSI Integrated Circuit Index advanced 5.44% on the same day.
The dramatic gains came on the heels of news that the U.S. Department of Commerce sent a letter to TSMC over the weekend, imposing restrictions on the export of advanced chips – 7 nanometer or more sophisticated designs – destined for customers in mainland China, according to reported by South China Morning Post.
Surprisingly, the market’s initial reaction exceeded many analysts’ expectations. Instead of panic, investors expressed optimism, believing that external pressure would act as a catalyst to accelerate self-sufficiency and stimulate independent innovation by Chinese companies in the semiconductor sector.
This positive market response reflects not only confidence in the progress already achieved by Chinese industry, but also high expectations about its development potential, especially in areas such as technological innovation, optimization and supply chain modernization.
In recent years, the US has tightened export controls on advanced technology and related products to China, creating significant obstacles for the Chinese semiconductor industry.
However, it is precisely in the face of these adversities that Chinese companies have demonstrated remarkable resilience and capacity for self-development. Amid external pressure, the sector’s self-sufficiency rate has increased steadily.
This trend indicates, at the very least, that China’s position in the global semiconductor industry is gradually strengthening, reflecting faster advances in technological innovation and localization.
With the global semiconductor market projected to exceed US$1 trillion by 2030, the growth potential of the Chinese market is substantial and cannot be ignored. This presents a significant opportunity to promote independent innovation in Chinese industry.
In addition to expanding research and development (R&D) efforts and promoting domestic production, China is also accelerating the acquisition of semiconductor manufacturing equipment.
According to the most recent data from SEMI, Chinese spending on this equipment reached a record US$25 billion in the first half of 2024, surpassing that of the US and South Korea.
Amid a global economic slowdown, China was the only country to record a year-over-year increase in spending on chipmaking equipment during the first half of the year. These numbers highlight the determination of Chinese industry to expand its production capacity and develop new technologies.
Although Chinese companies have made notable advances in the mid- and low-cost semiconductor market, significant challenges remain in achieving cutting-edge technology leadership.
U.S. export controls, while boosting independent innovation in the short term, pose a considerable obstacle in the long term, especially with regard to advanced technology.
For example, there is still a considerable gap between China’s technological capabilities and the world’s most sophisticated lithography equipment.
If expected advances in key technologies, such as domestically produced lithography machines, do not materialize, this could harm the expansion and production plans of national manufacturers.
The path of Chinese companies towards the cutting-edge technology segment is long and challenging.
On the one hand, it is necessary to intensify investments in R&D, prioritizing advances in critical technologies and strengthening self-sufficient capabilities. This requires coordinated efforts between companies, government, universities and research institutions.
On the other hand, it is essential to reinforce international cooperation, actively participating in the development of the global semiconductor chain.
With information from Global Times*
Source: https://www.ocafezinho.com/2024/11/13/china-diz-que-ataques-comerciais-dos-eua-a-farao-investir-ainda-mais-em-inovacao-e-tecnologia/
