Chip export restrictions by the US and its allies have increased, forcing Beijing to take strategic retaliatory action in response.
An important development in China’s domestic semiconductor market has been the upstream and downstream businesses’ increased cooperation.
In a made-up television show, a Chinese private technology company accepts a state project to create a laser for a deep ultraviolet lithography machine, machinery that is necessary for the creation of sophisticated chips but is currently governed by stringent US export regulations.
The story becomes more complicated when the company’s head is imprisoned by a foreign government and his wife, who has temporarily taken over management of the company, claims that it is about to collapse.
Tech war: China’s chip reality imitates the drama it inspired as US silicon curtain draws near
Without giving away the full storyline, we do know that the drama, The Best Chip, or My China Chip, has a happy ending thanks to online leaks. The 24-episode series had been slated to premiere on the Chinese video streaming platform Youku on July 10 but was abruptly delayed owing to “scheduling adjustments.”
However, because most internet users are aware that the country is currently on the losing end of a technology war with the US, which is casting a shadow over its plans for national renewal, the leaked images and plot spoilers have drawn a lot of online ridicule.
China has been obliged to respond to the US and its partners’ tightening chip export limits with deliberate retaliation instead of the customary chest-thumping. There are limitations on the export of the rare earth metals gallium and germanium, which are essential for the production of semiconductors, as well as a sales prohibition on a few items made by memory chip manufacturer Micron.
China anticipates prolonged industry disruption as a result of US trade penalties, according to Yu Xiekang, head of the China Semiconductor Industry Association, who spoke at the annual World Semiconductor Conference Expo (WSCE) in Nanjing.
The nation’s “national strategy to develop a robust digital economy and fast-growing domestic market,” however, “provide a strong chance for China’s chip industry to shift into a higher gear and upgrade its technologies,” he added.
Beijing has been preparing for a lengthy confrontation with the US while being aiming to solve its technology weak areas. Closer cooperation between upstream and downstream firms has been one shift in China’s domestic semiconductor sector.