Chinese chipmakers are preparing for increased sanctions with the return of Trump

Chinese giant Huawei Technologies came under unprecedentedly harsh US sanctions during Donald Trump’s first term, and its return to the White House does not bode well for many Chinese chip makers. Experts believe that the impact of sanctions can be mitigated by attracting foreign personnel to China.

Image Source: SMIC

Deputy head of the Beijing Association of Semiconductor Industry Companies Zhu Jing appealed to its members to develop their business abroad and explore the markets of new countries. In his opinion, if the coordination of the efforts of the US, Japanese and European authorities to curb the development of China under Trump weakens, then Chinese companies will have new opportunities to import the necessary chips.

During his first presidential term, Trump also sought to limit the access of Chinese students and specialists to study and work in the United States, so the expert called on Chinese companies to attract the necessary ready-made personnel outside the country. It is possible that Chinese companies, after Trump takes office as US President, will have new opportunities to attract qualified personnel and develop international cooperation. These changes need to be adapted in a timely manner, as noted by Zhu Jing.

In the first nine months of this year, Chinese companies increased their spending on equipment purchased outside the country by a third to $24.12 billion. Of this amount, approximately $7.9 billion was spent on lithography systems, corresponding costs increased by 35.44%. in annual comparison. The vast majority of lithography machines were obtained by Chinese companies from the Netherlands; $7 billion was spent on their purchase. Political uncertainty in the United States forced Chinese companies to purchase equipment for chip production at an accelerated pace. As the head of the Chinese company SMIC explained, at the moment there may be an excess of production capacity in the Celestial Empire for the production of chips using mature lithography.