China Forces its way into Semiconductors

By pjain      Published July 24, 2020, 5:58 p.m. in blog Invest   

---- China Brute forces its way into Semis

Conscious Push for Self Reliance needed - "can't buy technology"

Technology gap that may never be closed if China continues down the same path of importing foreign technology instead of developing its own.

Otherwise what has happened in the past China may have had little choice of importing hi-tech know-how given how far it had fallen behind in technology and manufacturing expertise which was NOT provided at any price.

So China started with assembly lines for color televisions, then to cars and integrated circuits, but the technology that is sold to China is often outdated and obsolete.

HKO front runs Greater Bay - still has access to US tech

  • Hong Kong ironically is in a unique position under the “one country, two system” principle, whereby access to technology from the US and other countries is still available to companies who set up branches in Hong Kong ie won't work from a purely mainland presence. However work product can be used anywhere in the world, and the employees can commute from mainland as needed.

  • Five mainland-China companies have set up branches that involve integrated circuit R&D in Hong Kong.

HKO as design hub for ASICs

  • As China integrates HKO in Greater Bay Area to create huge demand for HKO to be big leader. Unique place for so many big companies are located in such a small region, and with such huge potential demand.

ASTRI’s clients will need to set up a Hong Kong-based entity as the organisation aims to bring R&D capabilities to the city. “The role ASTRI plays is to group people together to make a bigger impact.”

  • In the semiconductor sector, the institute is a leader in the development of Narrowband Internet of Things (NB-IoT) chips, which support a wide range of applications in smart cities and consumer electronics, and the technology has been licensed to companies in mainland China, Europe and Israel, according to Shi.

The Greater Bay Area, touted as China’s answer to Silicon Valley, encompasses 65 million people and is home to some of China’s biggest technology companies, including Tencent Holdings, Huawei Technologies and drone-maker DJI in Shenzhen.

You often cannot just buy off-the-shelf as need to make custom low-volume chips for increasingly sophisticated equipment in defense and aerospace

Key institutions

  • Albert Wong, chief executive of Hong Kong Science and Technology Parks

  • Daniel Shi, senior director of Integrated Circuits and Systems at the Applied Science and Technology Research Institute, ASTRI, the largest government-funded R&D centre in Hong Kong, is one of the research institutes covered by the government’s drive. Established in 2000, the institute works with companies and start-ups globally to develop technologies applicable to their businesses.

  • ASTRI has setup a National Engineering Research Centre for Application Specific Integrated Circuit Systems, a leading chip design centre, which allows ASTRI’s IC partners to apply for national funding from China.

Resources

Key: China 2025 Semi Aggression and emergence as Super Power

Trade War Cannot rely on US, Japan, Taiwan or S. Korea - current leaders

China and USA are decoupling - and this is sending shock waves through the global supply chain and have exposed China’s dependence on American technology for key pillars of its economy.

  1. Huawei Technologies, was put on a trade blacklist that prevents American companies like Intel and Qualcomm from selling it chips.

  2. ZTE, China’s second biggest maker of telecoms network equipment, faced a crippling trade ban over breaching a US sanctions agreement on Iran and North Korea. It was fined US$1.4 b and accept a US monitor before it was allowed to resume buying American microprocessors.

China lags world only by 5-10 years in Semiconductors

SMIC Semiconductor Manufacturing Intl Corp

  • Joseph Xie Zhifeng
  • 2011 left SMIC as VP
  • 2000 moved to Shanghai when Pudong was still mostly farmland and the entire Zhangjiang hi-tech park was a village. This was after stints at Intel and Chartered Semiconductor.

High Tech has a VERY complex supply chain and dependencies

“There’s a Chinese saying that even a clever housewife cannot cook a meal without rice. But in this case, we didn’t just lack the rice, we didn’t even have stoves, pans and other cookware,”


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