China Faces Major Hurdles For Chip Sufficiency

China wants to develop the world's most advanced technology on its own as Western countries step up legal blockades aimed at cutting it out of the world technology trade.

Photo Insert: The US and Western allies are also banning Chinese companies from entering their 5G markets.

Beijing has unveiled a wide range of policies to boost tech self-reliance over the past decade, providing state funding to keep pace with the US, the South China Morning Post (SCMP) reported.

The US and its Western allies are blocking Chinese firms from accessing advanced chips, choking Beijing's efforts to develop semiconductors and artificial intelligence (AI).

They are also banning Chinese companies from entering their 5G markets.

To reach self-sufficiency, China must overcome three big barriers, analysts said, which will lead to one big pay-off if they can. Curbs on hi-tech investments both within and outside China will probably limit the "kind of information sharing that is crucial to the rapid development of hi-tech manufacturing sectors," Moody's Investors Research said in mid-July.

A limited Chinese presence overseas will reduce any odds of China having a voice in global tech standards. The whole process, it said, could lead to "funding shortfalls."

Reaching mass production with a high yield rate will require "significant time, manpower, and capital investment," the Australia-China Relations Institute at the University of Technology Sydney found in a June study.

China needs all the necessary equipment immediately, it added. China will need continued access to foreign capital, markets, and expertise, the Heritage Foundation think tank said in March.

The US, Japan, and the Netherlands have banned advanced chip-making equipment sales to China.

"Even if China succeeds in creating an advanced AI chip-design firm, Chinese foundries cannot fabricate the chips without advanced foreign equipment and chemicals," the Center for Strategic and International Studies (CSIS) said in a March study.

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