The SCMP report suggests that the U.S.'s semiconductor export sanctions could lead to unforeseen outcomes, especially within China’s semiconductor sector. Interestingly, the sanctions do not apply to legacy chips, defined as those using 28nm or older process technology. This exemption is due to their extensive application in crucial devices and the belief that they pose no national security risks. In this video, we will dissect what really happens with the actual chip production in China and why China is continually growing stronger even though the US sanction is still in effect.

This exemption has triggered an impressive 40% increase in China’s production of legacy chips in the first quarter of 2024, with a record 36.2 billion units manufactured in March alone. This increase highlights China’s dedicated efforts to strengthen its semiconductor production capabilities, a strategic move that started in Q1 2019 with the aim of decreasing reliance on foreign chip imports.

In conclusion, while the U.S. sanctions have unintentionally stimulated China’s expansion in legacy chip production, the attainment of true self-sufficiency in semiconductor manufacturing is a complex and ongoing task. China’s semiconductor industry must strike a careful balance between increasing domestic production capacity and reducing dependence on foreign chip imports to achieve its long-term strategic goals. We will follow up on this topic and report back.

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Keywords: #chinatechnology #chinanews #china