Chinese firms have achieved varied degrees of progress across the semiconductor ecosystem since the launch of Beijing’s made in China 2025 plan in 2015. At this point, it is probable that China will break free from the US chokehold in short order, with its chip industry faring little worse for wear. According to the Brookings Institution, Chinese businesses now account for 20% of the world’s fabless chip design houses and 10% of total global chipmaking capacity. According to Semiconductor Industry Association data, China’s 9% share of global chip sales in 2020 places it ahead of Taiwan and only behind the 10% held by both the EU and Japan.
In 2020, the administration of then-US President Donald Trump prohibited Taiwan Semiconductor Manufacturing Co. and Samsung from producing sophisticated semiconductors for Chinese businesses on the Entity List such as Huawei. Last year, US President Joe Biden’s administration announced that high-performance computing chip exports from the US to China would require approval; sales of semiconductor manufacturing equipment to China that can be used to produce logic chips at or below the 14 or 16-nanometer technology node, DRAM chips with a half-pitch less than or equal to 18 nanometers, and NAND chips with 128 or more layers would also require approval; and all US citizens or permanent residents working for US companies would require approval.
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