April was an eventful event for China’s electronics industry. First, on April 3, U.S. trade signed an additional 25% import duty on more than 120 items of technology electronic products in China. Then, on April 16, the U.S. Department of Commerce announced that it prohibited US companies from selling to ZTE. Semiconductor products, aging for 7 years.
It is not difficult to see that the United States is using the banner of “unfair trade” to take a further trade war against China. It is hard to imagine how these bans will be fully implemented and how ZTE should deal with them to survive the crisis.
A series of measures in the United States undoubtedly made a splash to China. Due to the rise of artificial intelligence and the Internet of Things, semiconductor chips have ushered in an unprecedented golden era. In 2017 alone, the amount of imported semiconductor chips in China reached 260.14 billion U.S. dollars, and China’s self-determination of semiconductor chips has become a priority. The ZTE event once again highlighted the “dead spots” of China’s semiconductor chips.
To sum up the current situation of China’s semiconductors, perhaps some inspiration. Current status of China’s semiconductors: 1. At present, China is the world’s largest semiconductor consumer country, and consumes 45% of the global market share of semiconductor chips each year. 2. China’s 90% of semiconductor chip consumption depends on imports, and imports far exceed oil prices. 3. Chinese semiconductor chips started relatively late and fell behind the world average. 4. The world’s semiconductor giants have formed a complete ecological chain, and the commercialization of Chinese semiconductor companies is difficult.
A lot of people in the ZTE incident analyzed the result that both China and the United States will suffer. But in reality, the United States is “injured”, but ZTE means “dead.” Since ZTE collapses, the United States can continue to support other foreign communications companies to achieve alternatives and quickly absorb ZTE’s market share.
Under the intervention of both governments, the two parties are likely to reach an agreement. However, if this negotiation lasts for more than two months, ZTE’s inventory will be exhausted and it will have irreversible consequences.
After this incident, Chinese companies were able to learn from their pain and make more independent research and development of chips. However, in order to achieve complete self-supply of semiconductor chips in the short term, it is absolutely impossible for them to focus on the future and have an odds.
China is so powerful. Why is it that a small semiconductor chip is stuck? The fact is, in the semiconductor field, even if you have money, you cannot do what you want.
Originally, China could rely on the acquisition of semiconductor companies in other countries to obtain core interests, but a “Waistler Arrangement” has allowed Chinese semiconductor acquisitions to be rejected again and again. The Wassenaar Arrangement, also known as the Wassenaar Arrangement Mechanism, was established in 1996 after the dismantling of the Paris Coordinating Committee by the world’s major manufacturers of industrial equipment and weapons to control the international nature of conventional weapons and high-tech trade. organization. In this organization, the object of the target blockade mainly includes the major categories of vehicles: traditional weapons such as tank artillery, and weapons of the scientific and technological community, both military and civilian goods and technology. Among the countries that are restricted, there is China.
Back to the semiconductor chip industry, it is because of the Wassenaar Arrangement that it is difficult for China to acquire chip companies from abroad or import many devices in the chip field. While China wants to create its own chip technology, it needs a lithography machine, but China can’t buy any advanced lithography machine equipment and independently research and develop the lithography machine’s R&D experience. The gap is too big. Therefore, it is particularly difficult for China’s semiconductor industry to start.
Even if the “Wassenaar Arrangement” is bypassed, or the photolithography process can be used to achieve the world standard, China is still not complete in the semiconductor chip ecosystem, and the overall progress is slow. In recent years, China has achieved a lot in the semiconductor industry. However, we must admit that there is still a wide gap between China and the world’s advanced semiconductors.
In fact, China’s semiconductor industry will not take short cuts to win, but long-distance travel is long. To achieve the world’s top level, we must change from a fundamental point of view. The most important issue is talent. At present, China’s most in short supply is semiconductor talent to attract and cultivate semiconductor talent; followed by investment and emphasis on technological breakthroughs, and then China should increase semiconductors that encourage long-term investment in patient capital and cyclical investment in patient capital. The opportunity for companies to give trial and error cannot be achieved overnight.
The semiconductor industry is a technology-based field. Therefore, we only have constant innovation and master core technologies before we can have a certain amount of discourse in the international community. From a certain perspective, the ZTE incident is now a good opportunity for China, which can cause reflections on Chinese electronics companies and also promote Chinese industry innovation. BSM50GX120DN2
Intel accumulated more than 50 years of technical data from several scientists in materials physics before releasing the original PC chip; Samsung’s flash memory technology, 3500 engineers worked successfully for 20 years to design and complete the manufacturing process. FS450R12KE3
Therefore, China also needs to maintain long-term patience and hope that they can make major breakthroughs overnight. In the semiconductor industry, such shortcuts will not work. Only by exerting national strength and maintaining unwavering semiconductor R&D determination can we complete the grand industry of semiconductor chips and let us work together for China!
