Chinese chip industry execs call for greater supply chain self-reliance - report
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Chinese semiconductor industry executives urged for building up the domestic supply chain as U.S. plans to limit certain U.S. tech investments in China, depriving the country of advanced technology, Nikkei reported.
"To everyone across the country in the semiconductor industry, let's work together to overcome the difficulties," said Zhao Jinrong, chairman of state-owned chip equipment manufacturer Naura Technology, at an industry event in Wuxi, Jiangsu province in China.
About 400 companies participated in the Wuxi conference.
On Wednesday, the U.S. President Joe Biden signed an executive order to regulate certain U.S. investments in China in the three areas of, semiconductors and microelectronics, quantum information technologies, and artificial intelligence, or AI.
Honghu (Suzhou) Semiconductor Technology's CEO Jacky Lin on Wednesday said that the wafer transport equipment producer intended to double research and development spending every year, according to the report.
China semiconductor industry's push for self-reliance is reaping some benefits in certain ways.
China's largest chip foundry Semiconductor Manufacturing International (OTCQX:SIUIF) reportedly plans to supply Huawei Technologies with 5G chips. However, the company is expected to use less advanced manufacturing equipment which falls outside of export curbs placed by the U.S. and other countries, the report added.
Chinese companies are rushing for improvements in photolithography, which traces circuit patterns for chips, an area currently led by Dutch group ASML (ASML) (OTCPK:ASMLF) and Japanese companies.
Government-run Shanghai Micro Electronics Equipment will begin providing equipment capable of 28-nanometer chipmaking processes, according to a report in July. However, this is well behind the industry's cutting edge of 2 to 3 nanometers, according to the report.
The chart below shows YTD price-return performance of several top semiconductor companies:

Semiconductor imports in China by value declined by 22% in H1 2023, while imports of production equipment also fell. Whereas, domestic output of production equipment increased 30%, and domestic semiconductor production dipped by 3%.
Advanced Micro-Fabrication Equipment's Chairman and CEO Gerald Yin noted that China's maximum self-sufficiency in production equipment was 18% and the government is working with businesses to increase this level, with a focus on less-advanced chips, the report added.
The industry's self-sufficiency goal is 70% for 2035, according to a presentation for a speech given by Honghu Semiconductor's Lin, the report noted.
A day ago it was reported that Chinaâs top tech companies, Alibaba (NYSE:BABA), Baidu (NASDAQ:BIDU), ByteDance (BDNCE) and Tencent (OTCPK:TCEHY) (OTCPK:TCTZF) placed orders worth $5B for Nvidia's (NASDAQ:NVDA) high performance chips, which are important to make generative artificial intelligence, or AI, systems.
Generative AI services have taken the world by storm, since the launch of Microsoft-backed OpenAI's ChatGPT. Chinese companies including Alibaba, SenseTime (OTCPK:SNTMF) and Baidu have launched their own generative AI services.
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