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Huawei
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Inside China Tech: are the chips down for Huawei?

  • The world’s largest telecommunications equipment vendor has stockpiled chips for its 5G base stations to last until the first half of next year
  • Chinese chip foundry Semiconductor Manufacturing International Corp may become a major supplier for Huawei

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The Trump administration’s expanded sanctions against Huawei Technologies has forced the Chinese telecommunications gear maker to stockpile more chips for its 5G network equipment business. Photo: Reuters
Bien Perez

Hello, This is Bien Perez from the South China Morning Post’s Technology desk, with a wrap of our leading stories this week.

Despite recent moves by China to achieve greater self-sufficiency in strategic areas of technology, semiconductor design and production remains a complex industry that requires decades of research and development to advance. Meanwhile, the US just turned up the heat.

Reporters Che Pan and Celia Chen examined whether China’s fledgling semiconductor industry can rescue Huawei Technologies, the world’s largest telecommunications equipment supplier, from tighter US sanctions.
Last month, the Trump administration expanded its sanctions against Huawei by requiring foreign chip makers that use US technology to apply for a licence to sell chips to the China’s largest technology company. That vastly expanded Washington’s reach by bringing under its remit Taiwan Semiconductor Manufacturing Co (TSMC), the world’s biggest contract chip maker and key Huawei supplier.

“Huawei has no domestic substitutes for chip making in the short term,” said a Shanghai-based economist, who requested anonymity because of the sensitive nature of the topic. “It would take not only money, but require joint efforts of generations of engineers and scientists slogging away at basic scientific research to make progress in the semiconductor sector.”

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Huawei founder on cybersecurity and maintaining key component supply chains under US sanctions

Huawei founder on cybersecurity and maintaining key component supply chains under US sanctions
Shenzhen-based Huawei’s immediate priority, according to other analysts, is to make the most of a 120-day grace period until September to stock up on certain strategic inventory, following a similar move the company used after it was put on the US trade blacklist in May last year.
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