China has excelled in producing cutting-edge technology, yet struggles with mastering semiconductors, leading to anxiety among its elites. Recent trade restrictions by America and allies have spurred China to intensify efforts to develop its semiconductor industry through projects like xinchuang. Despite progress, China lags behind global competitors like Samsung and TSMC in chip production. Huawei’s advancements in AI chips and partnerships with SMIC show promise, but China’s dependence on foreign technology remains. Collaboration with Chinese chipmaking companies and state subsidies are bolstering domestic chip equipment manufacturers like AMEC and Naura. China’s government, prioritizing security, continues to heavily invest in and control the semiconductor supply chain.
https://www.economist.com/business/2024/02/13/china-is-quietly-reducing-its-reliance-on-foreign-chip-technology