boost, rather than hamper China’s domestic semiconductor industry.
“I believe China’s semiconductor industry will get reborn under such sanctions and realize a very strong and self-reliant industry,” Xu said.
Experts previously told CNBC that the latest round of U.S. restrictions are likely to hurt China’s semiconductor industry. Under the current rules, certain tools or chips that are made using American technology are not allowed to be exported to China.
The nature of the chip supply chain makes this very effective. U.S. tools are used across the chip production process, even if a semiconductor is manufactured in another country.
China’s domestic chip industry relies heavily on foreign technology, and it lacks companies that can match firms in the U.S., Taiwan, Japan and South Korea.
China has made self-reliance a big priority amid the tech battle with the U.S., but experts agree this will prove an extremely difficult feat.
Huawei breakthrough
Chinese firms are now trying to develop tools required for semiconductors domestically.
Last week, Chinese media reported that Xu in a speech said that Huawei and other domestic firms jointly created electronic chip design tools needed to make semiconductors sized at 14 nanometers and above. Xu said those tools will be verified this year, which would allow them to be put into use.
The rotating chairman confirmed that he made this speech, but added those tools will “mean very little” for the Huawei business. It only means that Chinese firms have the design tools required domestically, he said.
The 14 nanometer figure refers to the size of each individual transistor on a chip. The smaller the transistor, the more of them can be packed onto a single semiconductor. Typically, a reduction in nanometer size can yield more powerful and efficient chips.
But Huawei ideally needs chips of a much smaller nanometer size for more advanced applications, which they are currently finding it difficult to obtain. The company is still reeling from the effects of U.S. sanctions — on Friday, it said net profit dropped 69% year-on-year in 2022, marking the biggest decline on record.
