The global battle for preeminence, or at least national independence, in semiconductor technology and manufacturing continues to heat up with Europe, China, Japan, and the U.S. all vying for sway. A fascinating article (China’s Next Target: U.S. Microchip Hegemony) in today’s Wall Street Journal examines China’s expanding efforts win the battle.
About 90 percent of the $190 billion worth of chips consumed in China today – roughly 58.5 percent of the market according to the article written by Bob Davis and Eva Dou – are imported or produced by foreign owned entities. No doubt we are covering old ground here, but the account explores China’s rapidly expanding efforts.
Here’s an excerpt: “We cannot be reliant on foreign chips,” said China’s vice premier, Ma Kai this year at a meeting of the National People’s Congress, China’s legislature. He heads a Communist Party committee that designed the country’s plan in 2014. Beijing created a $20 billion national chip financing fund—dubbed the “Big Fund”— and set goals for China to become internationally competitive by 2030, with some companies becoming market leaders.”
Davis and Dou write, “Today, the industry is riven by a nationalist battle between China and the U.S., one that reflects broad currents reshaping the path of globalization. Washington accuses Beijing of using government financing and subsidies to try to dominate semiconductors as it did earlier with steel, aluminum, and solar power. China claims U.S. complaints are a poorly disguised attempt to hobble China’s development. Big U.S. players like Intel Corp. and Micron Technology Inc. find themselves in a bind—eager to expand in China but wary of losing out to state-sponsored rivals.”
Link to The Wall Street Journal article: https://www.wsj.com/articles/chinas-next-target-u-s-microchip-hegemony-1501168303