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In the future of chip globalization, there will only be two ecosystems: China and the United States.

Updated: Jun 5

Semiconductors, the cornerstone of modern technology, have demonstrated the importance of global cooperation and resource sharing for industrial development in the past 20 years.

Professional companies from all over the world, from design to manufacturing and then to packaging and testing, work closely together to drive the continuous progress of the semiconductor industry, leading to the continuous evolution of technology.


Luowen Chen, Senior Vice President of Manufacturing Technology and Operations at Qualcomm, said, "The semiconductor industry drives the development of future technology, and we must gather the power of global talent to achieve our ambitions together."

However, the global ecosystem is facing challenges of geopolitical tension and national competition, especially the strengthening of US semiconductor export controls on China.


In 2024, the United States plans to introduce new export control measures to address China's potential ability to use cutting-edge chips in artificial intelligence and military fields.

Affected by export restrictions in the United States, China's integrated circuit imports decreased by 15.4% in 2023.


In addition, the Dutch government has revoked the license to export key equipment to China, further limiting the development of China's semiconductor industry.


Faced with these challenges, China has chosen to accelerate the construction and improvement of its domestic semiconductor industry chain, striving to reduce its dependence on external technology and equipment.

The top ten chip equipment manufacturers in China saw a 39% year-on-year increase in revenue in the first half of 2023, demonstrating the self-reliance of the Chinese semiconductor industry.


With the deepening of US sanctions and the maturity of China's semiconductor industry, the global semiconductor industry is undergoing changes.

The technological and trade differences between the two major economies of China and the United States indicate that the global semiconductor industry will divide into two ecosystems.


As the world's largest chip consumer market, China's demand is crucial to the global supply chain.


China has a huge manufacturing foundation and a complete industrial chain system, providing solid support for it in global semiconductor competition.


Despite facing strict export controls from the United States, China still obtains restricted American semiconductor technology through third-party channels.


For example, Chinese universities have purchased Nvidia advanced semiconductor chips in the face of US export controls.

China not only relies on self-reliance in technology, but also actively seeks new partners and increases investment in local technology development to ensure independent and controllable control in key technological fields.


Although the formation of the two ecosystems between China and the United States may lead to the fragmentation and efficiency reduction of the global semiconductor industry, it also prompts countries to strengthen their technological research and innovation capabilities, which may bring about technological diversity and ecological diversity in the future.


China's advantage in this new pattern lies in its huge market demand, comprehensive industrial system, and long-term planning and investment in future technological development.

However, the sanctions imposed by the United States have actually driven the development of China's semiconductor industry, which may have been an unexpected result for the United States.

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