Tech News: China To Boosts Its Chip Industry; Could Hurt US Tech Firms

June 4, 2019 | Tuesday



China to boost its own chip industry as major companies, including the Chinese tech giant Huawei are a threat to lose its operating access with American technology.

Experts believe that the world's second-biggest economy may still be at a decade off to catch up with the United States technology. On the contrary, if China succeeds in developing its semiconductor industry, which could hurt the American tech firms in the future, reaping its big profits in the country.

During the month of May, Chinese tech giant Huawei includes on the U.S. blacklist. That requires American firms to have a government-issued license before selling to the company. Huawei, as a telecommunications equipment maker, is dependent on a few major components from the U.S. firms and software, that includes Google and Microsoft. Upon the announcement that the Chinese Tech Giant will include in the U.S. blacklist, Washington grants a 90-day pardon. However, for now, the threat is a major problem for Huawei.

Elsewhere, other tech firms also targeted by the United States. That includes the Chinese surveillance giant HikVision. ZTE among Huawei's main competition faced the same situation last year, which negatively impacted the company.

China is open to the public when it comes to its plan to develop its own semiconductor industry during a couple of years back. Experts believe that during the recent happenings provided new focus to the company's drive.

According to Gu Wenjun, China-based semiconductor research firm ICWise analyst, Huawei's current situation "stimulated the development" for the whole country's local chip product industry.

Moreover, Beijing highlights semiconductors as China's main focus until 2025. Made in China 2025 plan was initiated by the Chinese government with a goal to enhance the production of high-priced products. The country aims to generate at least 40 percent of the semiconductor it uses until 2020 and at least 70 percent until 2025.


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