One of China’s main players in the ongoing chip war has established a research and development center for chips in Shanghai amidst increasing pressure from U.S. sanctions designed to limit its advanced technology advancements.
The Huawei Lianqiu Lake R&D Center is set to begin operations this year with a total investment of over 10 billion yuan, equivalent to $1.4 billion, according to a statement by the Qingpu district government. The statement noted that the research and development center will enable the Chinese tech giant to achieve significant breakthroughs in critical technological sectors such as 5G, cloud computing, and artificial intelligence.
In January, the state-owned Securities Times reported that nearly 30,000 personnel will be involved in the research and development of chips, wireless networks, and the internet at the center.
Huawei has been on the U.S. trade blacklist since 2019, and special licenses granted to U.S. chipmakers Intel and Qualcomm, which allowed them to sell to blacklisted Chinese chip firms, were revoked in May. Nevertheless, Huawei has seen a resurgence in China thanks to its Mate 60 Pro smartphone, powered by the Kirin 9000s chip.
The Kirin 9000s chip, using advanced 7-nanometer processing technology, represents a challenge to U.S. sanctions and was produced by China’s leading chipmaker, Semiconductor Manufacturing International Corp. (SMIC). According to Bloomberg, the companies utilized technology from U.S.-based Applied Materials Inc. and Lam Research Corp. to manufacture the chips. SMIC reportedly possessed this U.S.-made technology before U.S. companies were banned from supplying Chinese companies with advanced chips and chipmaking equipment in October 2022.
In April, U.S. Secretary of Commerce Gina Raimondo remarked that Huawei’s smartphone chip was “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 facing difficulties increasing production of its Ascend 910B chip—China’s best alternative to Nvidia’s chips, which cannot be sold to Chinese customers—due to breakdowns in components of repurposed chip fabrication machines.