Woman Smuggles Chips To China Inside Fake Baby Bump

Chinese customs officials arrested a woman last week for attempting to smuggle hundreds of semiconductor chips into Zhuhai, China, from Macau under a fake pregnancy bump, Sophie Mellor reported for Fortune.

Photo Insert: The smuggler initially aroused suspicion after claiming to be “about five or six months pregnant but had a big belly that looked like she was in the third trimester.

Border officials said on Thursday the woman was arrested on Nov. 25 carrying 202 processors and nine smartphones under a large pregnancy prosthetic, Bloomberg reported.

She initially aroused suspicion after claiming to be “about five or six months pregnant but had a big belly that looked like she was in the third trimester.”

The combination of high domestic demand and an extremely constricted supply of semiconductors has created a bustling underground market for microchips in China, where secondhand or out-of-date chips can fetch 500 times their original cost.

Semiconductor chips have been in acute shortage in China since 2020 when a global scarcity of chips caused by COVID-19 supply chain disruptions upended every aspect of the Chinese tech industry. The shortage has worsened since October 2022, when the US imposed sweeping curbs on the export of semiconductors made with US technology.

The export curbs were designed to cut off China's supply of critical technology that it may have been using for advanced computing and weapons manufacturing.

While China’s secondary chip market existed before the semiconductor crunch, it has ballooned in recent months as more people have sensed an opportunity to profit.

“Everyone’s a speculator,” an unauthorized broker of semiconductor chips told Bloomberg. China consumes more than three-quarters of the world's semiconductors but produces only about 15% of global output. With the decline in the trade of semiconductor chips, this imbalance is most noticeable in China’s car industry.

As car manufacturers attempt to pivot from internal combustion to electric engines, substandard chips are infiltrating the supply chain, putting quality and safety at risk.

According to one unauthorized broker who spoke to Bloomberg, the “conventional system whereby auto suppliers place an order through an authorized agent and wait for distribution from an original chipmaker no longer works.”

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