The U.S. has placed major chip export restrictions on Huawei and Chinese firms over the past few years. This has cut off firms’ access to critical semiconductors.
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China’s chip industry will likely be “reborn” because of this of U.S. sanctions, a top boss at Huawei said Friday, because the Chinese telecommunications giant claimed a breakthrough in semiconductor design technology.
Eric Xu, rotating chairman at Huawei, issued fighting words against Washington’s tech export restrictions on China.
“I feel China’s semiconductor industry is not going to sit idly by, but take efforts around … self-strengthening and self reliance,” based on an official translation of Xu’s comments during a press conference.
“For Huawei, we’ll render our support to all such self-saving, self-strengthening and self reliance efforts of the Chinese semiconductor industry.”
Semiconductors have been a flash point within the broader U.S.-China battle for tech supremacy. Over the past few years, Washington has attempted to chop China and Chinese firms off through sanctions and export restrictions.
In 2019, Huawei was placed on a U.S. black list called the Entity List, which barred American firms from selling technology to the Chinese company. This included chips for 5G products — where 5G refers to super-fast next-generation mobile networks. Chip restrictions against Huawei were tightened in 2020 and effectively separated it from the newest cutting-edge chips it required for its smartphones.
Washington then introduced broader chip restrictions last yr, aiming to deprive Chinese firms of critical semiconductors that might serve artificial intelligence and more advanced applications.
The U.S. is worried that China could use advanced semiconductors for military purposes.
Huawei’s Xu said these developments could boost, somewhat than hamper China’s domestic semiconductor industry.
“I feel China’s semiconductor industry will get reborn under such sanctions and realize a really strong and self-reliant industry,” Xu said.
Experts previously told CNBC that the newest round of U.S. restrictions are more likely to hurt China’s semiconductor industry. Under the present rules, certain tools or chips which might be made using American technology usually are not allowed to be exported to China.
The character of the chip supply chain makes this very effective. U.S. tools are used across the chip production process, even when a semiconductor is manufactured out of the country.
China’s domestic chip industry relies heavily on foreign technology, and it lacks firms that may match firms within the U.S., Taiwan, Japan and South Korea.
China has made self-reliance a giant priority amid the tech battle with the U.S., but experts agree it will prove a particularly difficult feat.
Huawei breakthrough
Chinese firms at the moment are attempting to develop tools required for semiconductors domestically.
The rotating chairman confirmed that he made this speech, but added those tools will “mean little or no” for the Huawei business. It only signifies that Chinese firms have the design tools required domestically, he said.
The 14 nanometer figure refers to the scale of every individual transistor on a chip. The smaller the transistor, the more of them might be packed onto a single semiconductor. Typically, a discount in nanometer size can yield more powerful and efficient chips.
But Huawei ideally needs chips of a much smaller nanometer size for more advanced applications, which they’re currently finding it difficult to acquire. The corporate remains to be reeling from the consequences of U.S. sanctions — on Friday, it said net profit dropped 69% year-on-year in 2022, marking the most important decline on record.