Last year, Chinese technology giant Huawei Technologies began shipping its Mate 60 Pro smartphone series, featuring HiSilicon Kirin 9000S processors. These cutting-edge chips were produced using SMIC’s state-of-the-art 7-nm technology. This development caused a stir in the West, as competing powers began to look for potential loopholes in the export control system. The controversy has deepened as some sources now claim that SMIC used American equipment for the production of these chips.
US Equipment at the Heart of Chip Production
According to sources contacted by Bloomberg, the 7-nm chips were fabricated using equipment from California-based firms Applied Materials and Lam Research. It is speculated that SMIC would not have been able to produce the 7-nm chips without Western equipment, specifically, ASML systems acquired from the secondary market. The Chinese technology giant allegedly obtained these systems before the imposition of trade restraints on equipment supplies to China, in October 2022.
Implications and Future Prospects
This circumstance arguably absolves Applied Materials and Lam Research from potential allegations by US regulators, as the said equipment was shipped to China prior to the introduction of the latest round of sanctions. However, the volume of the supplied equipment seems insufficient to allow SMIC or Huawei to mass-produce the 7-nm chips.
In a recent act of defiance, the US authorities encouraged their foreign policy allies to collaborate in limiting equipment and technology exports to China. Some of these countries have begun to voice their opposition to expanding sanctions as it contradicts their economic interests. Meanwhile, these measures only propel Chinese companies to strive for self-reliance in technology even more earnestly. Astute Western observers posit that it’s not a matter of if but when China will achieve this import substitution, underlining the undeniable progress and prowess of its tech specialists and manufacturers.
