One of China’s primary competitors in the semiconductor industry has established a research and development center for chips in Shanghai, amid pressure from U.S. sanctions intended to hinder its advanced technology progress.
The Huawei Lianqiu Lake R&D Center is set to begin operations this year with an investment totaling over 10 billion yuan, or $1.4 billion, according to an announcement from the Qingpu district government. The statement noted that the research and development center will aid the Chinese tech giant in achieving significant breakthroughs in key technological areas such as 5G, cloud computing, and artificial intelligence.
In January, the state-owned Securities Times reported that the center will host nearly 30,000 personnel dedicated to the research and development of chips, wireless networks, and the internet.
Huawei has been on the U.S. trade blacklist since 2019, and special licenses issued to U.S. chipmakers Intel and Qualcomm, allowing them to sell to blacklisted Chinese firms, were revoked in May. However, Huawei has seen a resurgence in China due to its Mate 60 Pro smartphone, which is powered by a Kirin 9000s chip.
This chip, utilizing advanced 7-nanometer processing technology — a setback to U.S. sanctions — was produced by China’s leading chipmaker, Semiconductor Manufacturing International Corp. (SMIC). Bloomberg reported in March that the companies had used technology from U.S.-based Applied Materials Inc. and Lam Research Corp. to manufacture the chips. SMIC reportedly possessed the U.S.-made technology before U.S. companies were restricted from supplying Chinese firms with advanced chips and chipmaking equipment in October 2022.
In April, U.S. Secretary of Commerce Gina Raimondo stated that Huawei’s smartphone chip “is not nearly as good” and “years behind what we have in the United States,” indicating that U.S. export controls are effective.
Meanwhile, Huawei is reportedly struggling to increase production of its Ascend 910B chip — China’s top alternative to Nvidia’s chips, which cannot be sold to Chinese customers — due to components in repurposed chip fabrication machines breaking down.