Explainer | China’s chip champion: can SMIC lead Beijing’s quest for semiconductor self-sufficiency?

Many of SMIC’s engineers, as well as key senior managers, were recruited from Taiwan, with TSMC being a primary target for talent

SMIC’s lack of access to EUV technology will mean it cannot produce more advanced chips, hindering its attempts to catch up to TSMC

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A view of Semiconductor Manufacturing International Corp’s headquarters in Shanghai on December 19, 2020. Photo: Bloomberg

Published: 10:00am, 31 Oct 2021

Established just over two decades ago in Shanghai, Semiconductor Manufacturing International Corp (SMIC) is considered the country’s national champion in producing chips used in various electronics products, from smartphones and computers to cars and mobile base stations.

Semiconductor production is a priority in China’s latest five-year plan, as the world’s second-largest economy braces for a heightened tech war with the US. China’s output of integrated circuits (ICs) reached a monthly record in July on the back of strong demand and the addition of new production capacity.

SMIC is building a new wafer fab in Beijing, expected to start operations in 2024, while a new Shenzhen plant will begin production next year. The company is also investing in a new facility in the Shanghai Lin-Gang area, a semiconductor industry cluster designated by the city government.

Tapping experienced semiconductor talent from Taiwan, the mainland Chinese chip foundry has been able quickly move up the technology ladder since it was established.

However, SMIC’s ability to close the technology gap with chip foundry giant Taiwan Semiconductor Manufacturing Co (TSMC) has been stymied by US trade sanctions, imposed because of its alleged ties to the Chinese military – a charge the firm denies. As a result, SMIC is focusing on mature technology nodes – which are now in high demand due to the increased use of chips in a wide range of consumer applications.

Here is all you need to know about China’s chip champion SMIC and how it is leading Beijing’s drive for semiconductor self-sufficiency.

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Explainer | China’s chip champion: can SMIC lead Beijing’s quest for semiconductor self-sufficiency?

Many of SMIC’s engineers, as well as key senior managers, were recruited from Taiwan, with TSMC being a primary target for talent SMIC’s lack of access to EUV technology will mean it cannot produce more advanced chips, hindering its attempts to catch up to TSMC

Many of SMIC’s engineers, as well as key senior managers, were recruited from Taiwan, with TSMC being a primary target for talent

SMIC’s lack of access to EUV technology will mean it cannot produce more advanced chips, hindering its attempts to catch up to TSMC