China became the single largest chip manufacturer

 Nineteen of the world's 20 fastest-growing chip industry firms over the past four quarters, come from China according to data compiled by Bloomberg. That compared with just 8 at the same point last year. That supercharged growth underscores how tensions between Washington and Beijing are transforming the global US$550 billion (S$760 billion) semiconductor industry. This sector plays a crucial role in everything from defence to the advent of future technologies like AI and autonomous cars.

Causes: In 2020, the US began restricting sales of American technology to companies like Semiconductor Manufacturing International and Hangzhou Hikvision Digital Technology, successfully containing their growth - but also fuelling a boom in Chinese chip-making and supply. Beijing is expected to raise billions of dollars of investment in the sector under ambitious programmes such as its "Little Giants" blueprint to endorse and bankroll national tech champions, and encourage "buy China" tactics to sidestep US sanctions. SMIC and Hua Hong Semiconductor, the biggest contract chip makers, have kept their Shanghai-based plants operating at almost full capacity even as the worst Covid-19 outbreak since 2020 paralyses factories and logistics across China.

Effects: Orders for chip-manufacturing equipment from overseas suppliers rose 58 per cent last year as local plants expanded capacity, data provided by industry body Semi show.

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